Skip to main content

Mobile Navigation

  • National
    • Policy
      • High Expectations
      • Quality Choices
      • Personalized Pathways
    • Research
    • Commentary
      • Gadfly Newsletter
      • Flypaper Blog
      • Events
    • Scholars Program
  • Ohio
    • Policy
      • Priorities
      • Media & Testimony
    • Research
    • Commentary
      • Ohio Education Gadfly Biweekly
      • Ohio Gadfly Daily
  • Charter Authorizing
    • Application
    • Sponsored Schools
    • Resources
    • Our Work in Dayton
  • About
    • Mission
    • Board
    • Staff
    • Career
Home
Home
Advancing Educational Excellence

Main Navigation

  • National
  • Ohio
  • Charter Authorizing
  • About

National Menu

  • Topics
    • Accountability & Testing
    • Career & Technical Education
    • Charter Schools
    • Curriculum & Instruction
    • ESSA
    • Evidence-Based Learning
    • Facilities
    • Governance
    • High Achievers
    • Personalized Learning
    • Private School Choice
    • School Finance
    • Standards
    • Teachers & School Leaders
  • Research
  • Commentary
    • Gadfly Newsletter
    • Flypaper Blog
    • Gadfly Podcast
    • Events
  • Scholars Program
Flypaper

Forecasting the long-run costs of coronavirus

Jeff Murray
9.30.2020
Getty Images/Totajla

Modeling the effects of a global pandemic while it’s ongoing seems like a prime example of “inexact science.” It’s also sure to depress. But it’s happening. A group of German and American economists recently added to the bleak parade with a working paper that looks at the consequences of Covid-19-mitigation school closures on current students’ human capital over time.

The analysts built a “heterogeneous agent partial equilibrium” model with a human capital production function at its core. The model’s inputs are time and monetary investments into education made by parents via several avenues (everything from academic enrichment to home purchases to college savings accounts) and by governments through the provision of schooling. They estimate that current closures are equivalent to six fewer months of schooling. Parents respond by adjusting their own investments in their children, thereby potentially mitigating the effects of school closures. In the model, parental time inputs rise by 4.3 percent and monetary inputs by 5 percent, but the global recession is also at work on parental resources.

The model’s outputs are children’s human capital as they progress through high school and college choice, subsequent earnings, and, ultimately, welfare as adults. In short: their futures.

Other recent research predicted that so-called “school shock” will reduce average lifetime earnings at the individual level by almost $10,000. This new prediction is in the same range. On average (across children aged four to fourteen when the shock occurs), the new model implies a 3.8 percent reduction in high school graduations and a 2.7 percent reduction in college degrees. Eighty-seven percent of those losses are directly attributed to the school closures, the rest to parents’ reduced capacity to mitigate the school shock.

Negative effects will be felt most keenly by the youngest children (ages six to ten at the time of the school shock). Older children have already accumulated more of their human capital and thus, the shock is less severe. Low-income families suffer more, both because a greater percentage of their educational inputs come from the government and because their parents have more constraints on how much time and money they can realistically muster to cover the loss.

All of this may sound abstract, but similar alarm bells are ringing among professionals in education, the private sector, psychology, and others in the research community. It is still early, however, and the direst predictions here are based on a total loss of six months’ worth of education. Yet the 2020–21 school year has dawned with many schools, districts, and families looking to kickstart learning and change the equation for their kids. For them, the “Covid slide” may prove remediable. Those who do not break free of their own form of “school shock” to focus on student achievement and growth will see their students end up being weighed down by grim inevitability of the math.

SOURCE: Nicola Fuchs-Schündeln, Dirk Krueger, Alexander Ludwig, and Irina Popova, “The Long-Term Distributional and Welfare Effects of Covid-19 School Closures,” NBER Working Papers (September 2020).

Policy Priority:
High Expectations
Topics:
Governance
Teachers & School Leaders

Jeff Murray is a lifelong resident of central Ohio. He previously worked at School Choice Ohio and the Greater Columbus Arts Council. He has two degrees from the Ohio State University and lives in the Clintonville neighborhood with his wife and twin daughters. He is proud every day to support the Fordham mission to help make excellent education options…

View Full Bio

Sign Up to Receive Fordham Updates

We'll send you quality research, commentary, analysis, and news on the education issues you care about.
Thank you for signing up!
Please check your email to confirm the subscription.

Related Content

view
High Expectations

How much education is a public responsibility?

Chester E. Finn, Jr. 2.2.2023
NationalFlypaper
view
High Expectations

Will ESAs change America’s definition of “public education?”: An interview with Ashley Berner

Robert Pondiscio 2.2.2023
NationalFlypaper
view
High Expectations

Schools have been adding teachers and student support staff, even as they serve fewer students

Chad Aldeman 2.2.2023
NationalFlypaper
Fordham Logo

© 2020 The Thomas B. Fordham Institute
Privacy Policy
Usage Agreement

National

1015 18th St NW, Suite 902 
Washington, DC 20036

202.223.5452

[email protected]

  • <
Ohio

P.O. Box 82291
Columbus, OH 43202

614.223.1580

[email protected]

Sponsorship

130 West Second Street, Suite 410
Dayton, Ohio 45402

937.227.3368

[email protected]