Effects of Head Start Participation on Adulthood Income: A Propensity Score Matching Approach

Background and Purpose

In 1965, Head Start program was introduced as part of War on Poverty. There was a hope that intergenerational transmission of poverty could be broken down by a comprehensive preschool program for low income children and their families. Since then, a number of studies have explored the impact of the program. The majority of those studies have focused on cognitive development and educational outcomes, and they generally suggest that the program produces short-term effects, but most of them disappear in the long-term. However, most previous studies suffered from comparability problems (i.e. different background characteristics) between program participants and non-participants. Further, although the main purpose of the program was to reduce poverty in the long run, confirmation of the idea has been almost ignored from the research for the last 40 years plus. The main purpose of this study is to conduct more rigorous evaluations in regard to the long-term effects of the Head Start participation on adulthood income. As human capital theory suggests, the mediating effects of educational attainment is examined.

Method

This study utilizes the Panel Study of Income Dynamics (PSID) data from 1970 to 2005. To examine the effects of Head Start participation on adulthood income, 983 young adults (aged 19 to 35 in 2005) are selected from the original PSID sample: 161 with Head Start experience and 822 with no preschool experience. Propensity Score Matching (PSM) analysis is employed to control pre-existing differences that might have an influence on Head Start enrollment. To examine whether the findings are constant regardless of how control groups are matched, four types of matching methods are applied: one-to-one matching without replacement, one-to-one matching with replacement, two-nearest neighborhood matching, and radius matching. After the PSM, most of pre-existing differences are sufficiently controlled. Using the matched samples, a series of path analyses are conducted with a mediating factor of educational attainment. To control the influence of other factors, several variables(community, family, and child related variables) are also included in the analyses.

Results

According to the results, there are no direct effects of Head Start participation on adulthood income. However, indirect effects through educational attainments are detected. Head Start participants were about 1.5 to 2 times more likely to have higher educational attainment than no preschoolers, depending on matching methods. Also, persons with college education had more earnings (by about $9,386) than people with less than high school education. Graduate school enrollment enlarged the gap to $20,916. Although the effect size varied depending on the background conditions, Head Start participation brought substantial gains to its participants through the increased level of education.

Conclusions and Implications

Although some studies have questioned about the long-term effects of Head Start participation, the programs effects on educational attainment become obvious when background characteristics are carefully controlled. Eventually, the effects lead to the increase of adulthood income. Continuous expansion of the program is suggested to reduce intergenerational poverty.