What do changes in state NAEP scores imply for birth cohorts’ later life outcomes?

Abstract Since 1990, the National Assessment of Educational Progress (NAEP) has been the primary benchmark for tracking the progress of state education reform. The focus on math and reading achievement is motivated by the cross‐sectional relationship between test scores and adult outcomes, such as earnings and college completion. But do changes in NAEP scores predict changes in long‐term economic and social outcomes for future earners—or do they reflect other factors unrelated to earnings such as teaching to the test? We investigate by linking long‐term outcomes by year and state of birth to NAEP scores. We find that more recent birth cohorts in states with large increases in NAEP math achievement enjoyed higher incomes, improved educational attainment, and declines in teen motherhood, incarceration, and arrest rates compared to those in states with smaller increases. In fact, the relationship between changes in NAEP achievement and cohort earnings is about two thirds the size of the cross‐sectional relationship observed in prior research: a 6% to 8% rise in earnings per standard deviation rise in 8th grade math. The results are not sensitive to controls for student demographics, labor market conditions, or measures of children's health (such as low birthweight).