First, they rely on data that are more than ten years old

Using the ECERS 7-point scale, the mean value of this index in their sample is 4

These studies have several limitations. If the relationships estimated in their model have changed since 1989, these estimates will differ from what we would expect to find using current data. Changes in quality made now may affect total costs in a different manner.

Also, the data include only accredited centers. If these centers have cost functions that systematically differ from unaccredited centers, the estimated results will not apply to those centers. If, for example, one is most concerned with improving poor quality child care, and such care is more likely to be found in unaccredited centers, these estimates may not provide an accurate depiction of the costs of doing so. The sample also only includes data for care of 4- and 5-year-old children. Because of differences in providing care for other age groups, the relationship between improving quality and costs for centers that provide care for other age groups ple includes data from many states, 70 percent of the centers surveyed were in the South and the Midwest. The results therefore may not be nationally representative.

Helburn (1995) estimates a similar cost function using data collected as a part of the Cost, Quality, and Child Outcomes in Care Centers (CQO) study. The CQO study, conducted in 1993–1994, included data from 401 child care centers (749 classrooms) in four states. The data, collected through classroom observation and interviews with program directors, include information on center characteristics, program quality and staff qualifications, compensation, and turnover. Helburn estimates center total costs as a function of staff wages at different education levels, hours of child care provided, physical size of the center, volunteer hours, region of the country, for-profit status, and quality measures. 8

This research also indicates statistically significant relationships between cost and quality. Increasing center quality online payday loans in OR by 25 percent (from mediocre to good) is associated with increases in total variable costs of approximately 10 percent, or $346 per child per year. The authors define quality using an index similar to the ECERS measure of quality of care. 0, which ranks between fair and good. 0, a rating of good quality, will be approximately 10 percent. Given an average size of 60 children per center, the increase in quality is expected to result in an increase in costs of approximately $20,700 per year. 9

They estimate that the increase in total variable costs associated with increasing the measure of quality by 25 percent to 5

Helburn notes that this analysis assumes that wages are held constant during the quality-changing process. The model specifically implies that wages for particular quality-levels of staff (here measured by years of education) are set in the labor market and centers pay the going wage. If, however, high-quality centers pay higher than market wages to attract the most qualified providers, or to increase productivity and/or lessen the chance of turong existing workers, then estimated costs will understate true costs.

Although this study considers all types of centers, not accredited centers only, it has similar limitations to the GAO and Powell and Cosgrove studies. That is, the data used are not as recent as would be desired, and the results from the four-state sample are not nationally representative.

Although all three studies have limitations, the estimates do provide information on the nature of the relationship between child care costs and quality. As such this research serves as a useful starting point for further consideration of this topic. The importance of developing cost estimates suggests that future work incorporating current and nationally representative data will serve as an important source of information for evaluating public policy strategies designed to improve the quality of child care. We have discovered one likely source of such estimates in research currently being conducted by Richard Brandon at the University of Washington and Lynn Kagan at Yale University. The authors are developing a detailed simulation model to estimate costs of improving child care using varied measures of quality. This research, which the authors estimate will be completed by the fall of 2000, will provide valuable additional information