Cost Analysis and Fiscal Viability of Early Childhood Development Services for 0-3-Year Olds in China

• In Event: Empowering China's Youngest Rural Children: Uniting Intervention Research and Policy Advocacy for Lasting Impacts

Abstract

Objectives and theoretical framework
China has yet to introduce specific policies and financial support for 0-3 ECD services in rural areas, largely due to concerns about the effectiveness and financial feasibility of the existing project models. This study aims to analyze and compare the costs of early childhood development (ECD) services for children aged 0-3 in rural China, estimate the costs of implementing such services nationwide, and explore the fiscal feasibility of government investment in these services. The research seeks to address the lack of specific policies and financial support for rural ECD services in China by providing evidence-based cost estimates and assessing financial viability. The study is framed within the context of successful ECD program implementations in developing countries. It posits that if the costs of rural ECD services in China are reasonable and manageable, considering the country's current financial investment in child development and the decreasing child population, it may be feasible for China to provide national fiscal support for ECD services for children aged 0-3 in rural areas.

Methods
The research employs a comparative analysis of ECD project models, effectiveness, and costs across developed and developing countries. It utilizes the REACH UP framework to estimate ECD service costs in China, as this framework closely aligns with China's mainstream ECD projects. This framework has been used in different project models and in several developing countries such as India (Grantham-McGregor et al., 2020) and Jamaica (Walker et al., 2015).

Data Sources
The study draws on expenditure data from 10 typical ECD projects in various countries (United States, the United Kingdom, Ireland, Jamaica, Mexico, Brazil, Kenya, Pakistan, and India), documented in 16 academic articles or project reports. For China, data were collected from three influential ECD projects, including first-hand financial records from the China Development Research Foundation and estimates provided by project management teams. Additional financial and population data were sourced from publicly available government information, such as the data from past National Population Censuses and Educational Statistics Yearbooks of China.

Results
The study estimates that the average cost of rural infant care services in China is approximately 350-472 USD per child per year. Providing ECD services for 0-3 years old children in all rural areas of China would require 5.5-6.9 billion USD, approximately 0.8%-1% of the nation’s fiscal education expenditure. Given the declining population in the 3-6 years old age group, the surplus of central fiscal education fund can essentially meet this financial need.

Significance
This study fills a critical gap in global data on ECD project costs by estimating the costs of mainstream ECD projects in China and analyzing influencing factors. It provides valuable references for project implementation and cost control in regions with similar development conditions. The research also lays a foundation for establishing cost-sharing mechanisms for rural infant care services in China. In the context of global population decline, this study offers insights for other developing countries on how to share the costs of ECD services at the national level.

Authors

• Zhixin Du, China Development Research Foundation

• Peng Liu, China Development Research Foundation

• Qiwen Li, China Development Research Foundation