This idea is the central tenet of a recent column in the Wall Street Journal by Robert Litan.

How Improving Education Could Pay Off in Economic Growth

In a recent Think Tank piece, I focused on two ways to boost long-term economic growth: more risk-taking by larger companies, and more start-ups. Neither is easy to accomplish, nor for government to immediately change.

Fortunately, there is one surefire way, at least in principle, to boost growth and improve equity: by improving the quality of K-12 education (emphasis on quality). Up to now, most economic research on education has focused on quantity or how many years of schooling the average person has completed. Yet it’s what people learn, not now long they take to get there, that really matters.

Research by a longtime expert on the economics of education, Erik Hanushek of the Hoover Institution, and professor Ludger Woessmann of the Ifo Institute for Economic Research in Germany discusses evidence from across that world that national average student performance at age 15 on an internationally standardized mathematics test is predictive of that nation’s future economic growth. The authors’ statistical analysis shows that math abilities are most highly correlated with economic growth and that they are probably serving as a proxy for a range of problem-solving skills (which require ability to comprehend what one reads and to use that knowledge in constructive ways).

On the international test where the average score is 500, raising the average by 25 points would generate more than $40 trillion in cumulative additional output over the next 20 years in the U.S., the research found. That’s after discounting for the “time value of money,” a standard adjustment in benefit-cost analyses. That addition is equivalent to two entire years of gross domestic product!