The Brookings Institution
By Isabel V. Sawhill and Quentin Karpilow
Children born into low-income families face barriers to success in each stage of life from birth to age 40. Using data on a representative group of American children and a life cycle model to track their progress from the earliest years through school and beyond, we show that well-evaluated targeted interventions can close over 70 percent of the gap between more and less advantaged children in the proportion who end up middle class by middle age. These interventions can also greatly improve social mobility and enhance the lifetime incomes of less advantaged children. The children’s enhanced incomes are roughly 10 times greater than the costs of the programs, suggesting that once the higher taxes and reduced benefits likely to accompany these higher incomes are taken into account, they would have a positive ratio of benefits to costs for the taxpayer. The biggest challenge is taking these programs to scale without diluting their effectiveness.
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