PISA The High Cost of Low Educational Performance: The Long-run Economic Impact of Improving PISA Outcomes

Foreword......Page 5
Table of contents......Page 7
Figure 1: Present value of Scenario I (improve student performancein each country by 25 points on the PISA scale) in billion USD (PPP)......Page 8
Figure 3: Present value of Scenario II (improve student performance in each country to reach the levelachieved by Finland, the country with the highest performance in PISA) in percent of current GDP......Page 9
Figure 5: Present value of Scenario III (ensure that all students perform at aminimum of 400 points on the PISA scale) in percent of current GDP......Page 10
Introduction......Page 12
The effect of education on economic growth......Page 13
Box 1. Theories of economic growth......Page 14
Empirical growth analyses considering cognitive skills......Page 15
Measuring cognitive skills......Page 16
Box 2. Empirical growth models with cognitive skills......Page 17
Basic facts of cognitive skills and economic growth......Page 18
Evidence on causality......Page 19
Figure 7: Educational performance and economic growth in the full sample......Page 20
Figure 8: Trends in educational performance and trends in economic growth rates......Page 21
Simulation approach......Page 22
Scenario I: Increase average performance by 25 PISA points......Page 24
Table 1: Effect on GDP of Scenario I:Increase average performance by 25 points on PISA, or by ¼ standard deviation......Page 25
Scenario II: Bring each country to the average level of Finland......Page 26
Scenario III: Bring everyone up to a minimum skill level of 400 PISA points......Page 27
Table 3: Effect on GDP of Scenario III: Bring all to minimum of 400 points on PISA......Page 28
Policy Conclusions......Page 29
References......Page 31
Notes......Page 33
Annex A: Deriving a Combined Historical Measure......Page 37
Table A1: International tests by period, subject, and age group......Page 38
Table A2: The international student achievement tests......Page 39
Figure A1: Student achievement in the United States over time:The National Assessment of Educational Progress (NAEP)......Page 40
Table A3: International data on cognitive skills......Page 43
Figure A2: Examples of the distribution of student performancein selected OECD countries......Page 45
Annex B: Underlying Cross-Country Growth Regressions......Page 47
Table B1: Educational performance and long-run economic growth across OECD countries......Page 49
Annex C: Projection of the Economic Value......Page 51
Table C1 Parameter values for simulations......Page 53