Research Paper on Opportunity Cost: Understanding Scarcity & the Optimal Distribution

Introduction

Opportunity cost is an economic term that refers to the value, profit, or benefit that must be given up to achieve or acquire something else (Piper, 2018). The fundamental problem of economics is scarcity. Since every resource including time, money, and land among others can be put to alternative use, every decision, choice, or action has an associated opportunity cost. People are forced to make choices whenever there is a scarcity. Hence, economists are concerned with the optimal distribution and use of these scarce resources. Opportunity costs are critical costs and are used in decision making especially in analyzing the cost-benefit of a project. Educating a child is a project and there is an opportunity cost because there are benefits and costs of such a project. This paper shall examine the external benefits of excellent early education.

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Discussion

One of the major benefits of an excellent early education to the child is in regards to cognitive, social, and emotional development as well as on their later school career. Education and learning are believed to start earlier than when a child enrolls in formal compulsory education. Various longitudinal researches have revealed that skill gaps emerge before formal schooling. For example, early education introduces the young child to organized instruction outside the context of the family. In other words, the child becomes socialized early into the rules and norms of society. The ability to conform to the existing laws and norms of the society is essential to the wellbeing of the child because failure to adhere to these norms usually leads to disciplinary problems. Hence, early education leads to early integration into the wider society (Karoly, Kilburn, & Cannon, 2005).

Secondly, children who attend early education are found to have higher educational attainment than those that do not. Due to their early introduction, these children generally perform better in school in terms of grade retention rates, test scores for numeracy and literacy retention. Besides, such children are found to have high college attendance rates. Accordingly, these remarkable scores and early investment in education ultimately generate high returns and lower the costs of education investment at a later stage because they make learning at later ages more efficient.

All these are important benefits for both the parents and the government. For example, due to early education, the child gets to spend low or no time and money in special education in their academic life. As a result, parents pay less money for tuition. On the other hand, by graduating early and in large numbers, the children enter the workplace and contribute to the social building through paying taxes. Consequently, they help parents in saving money while contributing to nation-building through taxation early in life (National Education Association, 2019). However, of most importance is the fact that the child is highly likely to graduate from college and earn a decent wage.

At the societal level, the economic benefits of early education take the form of increased revenues and reduced social spending in specific policy domains such as taxation or social security. These observed public benefits are closely linked to the outcomes identified at the personal level. In the initial phases, the cost of setting up a government-financed high-quality early education program can be high. However, when the program starts to mature, the benefits are usually very high. For example, public expenditure is likely to drop because of few students enrolling in special education, repeating grades, dropping out of school or needing additional lessons (Sawhill, Tebbs, & Dickens, 2006). There is ample evidence, that in general, the social benefits of early childhood education outweigh the costs.

Lastly, early childhood education is important for the labor market participation of the parents, especially mothers. The upsurge in the participation of women in the labor market has been attributed to the enrollment of children in early childhood care and education. Because women are still the primary caregivers in many families, the organization of early childhood education directly affects the ability of the mothers to participate in the labor market. If no early childhood education programs exist in a country, mothers are likely to reduce working time by taking part-time jobs or dropping out of work altogether (Piper, 2018). As a result, the presence of an excellent early education platform leads to an increase in the number of mothers participating in the workforce. In return, it increases the income of the family especially if the father is already working.

Conclusion

The paper sought to examine the external benefits of excellent early education. As revealed, high-quality early education and care have major benefits to the child, the parents, the society and the government at large. As examined, early education is directly linked with high educational attainment that translates to higher chances of being employed and earning a decent wage. This form of education is also beneficial to the child as it introduces them to the structured social norms and regulations outside the family setting. Moreover, high-quality early education programs save parents and governments a lot of money and reap high financial benefits after maturation.

References

Karoly, L. A., Kilburn, R. M., & Cannon, J. S. (2005). Proven benefits of early childhood interventions. Retrieved from Rand Corporation: https://www.rand.org/pubs/research_briefs/RB9145.html

National Education Association. (2019). Early childhood education. Retrieved from http://www.nea.org/home/18163.htm

Piper, K. (2018, Oct 16). Early childhood education yields big benefits - just not the ones you think. Vox. Retrieved from https://www.vox.com/future-perfect/2018/10/16/17928164/early-childhood-education-doesnt-teach-kids-fund-it

Sawhill, I. V., Tebbs, J., & Dickens, W. T. (2006, Apr 30). The effects of investing in early education on economic growth. Brookings. Retrieved from https://www.brookings.edu/research/the-effects-of-investing-in-early-education-on-economic-growth/