Those individual benefits can be substantial, and life-changing. For example, if a low-income parent is able to secure a place for her child in a high quality daycare program, that child is likely to benefit from exposure to a wider array of learning opportunities than he or she might have at home. Enrolling her child in daycare may also open the door for the parent to take on employment or further her education in order to improve her career prospects.
The primary beneficiaries are children and their parents. Who benefits from early childhood programs? In other words, the original investment generates a financial return.
Early childhood programs cost money, of course, but studies show that the benefits associated with such programs also come with monetary gains and savings. When the projected benefits exceed the projected costs, then these programs can be seen as “paying for themselves” and then some over time. The return on investment, or ROI, is a common performance measure used to evaluate and compare the efficiency of financial investments. In the strictly financial sense, an investment is an outlay of money from which one expects a return of some kind, in addition to the original amount allocated.
What does it mean to “invest” in early childhood? This brief explores the notion of return on investment, and the rationale behind the economic and business case for spending on early childhood.įor more on the return of early childhood programs from an economist and researcher in the field, see Investing in Kids Can Yield High Returns: Q&A with Dr. A common argument for supporting early childhood is that it is a good “investment.” Often, the term is used colloquially, meaning that early childhood is an area in which funders can make a positive difference, and that support is broadly beneficial for children. While the colloquial meaning of investment is certainly valid, when business people and economists talk about investment and return on investment in early childhood, they generally mean something more specific.
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