School performance matters.

• Author: Hanushek, Eric A.

In recent weeks, two separate reports on international student performance were released. The performance of students in the United States has remained consistent ever the past three decades--dismal. On the Program for International Student Assessment (PISA) mathematics tests, U.S. fifteen-year-olds tied for twenty-seventh out of thirty-nine, outscoring students of such systems as Turkey, Mexico, and Tunisia. In 1995, on the Trends in International Mathematics and Science Study (TIMSS), U.S. students ranked in the top half of the distribution, which included more developing countries, but showed mixed performance gains compared to other nations taking the tests.

The usual response in the United States to announcements of such international results is to ignore them. After that, it is convenient just to explain them away: other countries test a more selective group of students, or the tests do not match our normal curriculum. Neither story is convincing, but with the general indifference to the results they do not have to be.

These results, however, should be taken very seriously. Research demonstrates that the skills measured on these tests are important in the labor market and have a substantial effect on national growth rates. Existing evidence indicates that the scores' importance to national growth is hard to overstate.

If the performance of U.S. students were to reach the middle of that of European students (still noticeably below the top), according to historical data, the U.S. economy could realize a half of 1 percent boost in its annual growth rate. Half of 1 percent sounds like a small difference, but it is in fact a very large number. The United States currently has a GDP per capita of $38,000. A half percent of additional annual growth would...