Early Childhood Initiatives and Third-Grade Outcomes in North Carolina

This study examines the community-wide effects of two statewide early childhood policy initiatives in North Carolina. One initiative provides funding to improve the quality of child care services at the county level for all children between the ages of 0 to 5, and the other provides funding for preschool slots for disadvantaged four-year-olds.

Differences across counties in the timing of the rollout and in the magnitude of the state financial investments per child provide the variation in programs needed to estimate their effects on schooling outcomes in third grade.

The authors find robust positive effects of each program on third-grade test scores in both reading and math. These effects can best be explained by a combination of direct benefits for participants and spillover benefits for others.

The combined average effects on test scores of investments in both programs at 2009 funding levels are equivalent to two to four months of instruction in grade 3.