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Would Obama's Dropout Idea Actually Work?

In his State of the Union speech last night, President Obama called for states to adopt laws limiting the ability of high school students to drop out. The president pointed out that “when students aren’t allowed to walk away from their education, more of them walk the stage to get their diploma.” To get more students walking on the stage, the president called on “every state to require that all students stay in high school until they graduate or turn eighteen.” What effect would these laws have?

A 2002 study argues that laws requiring students to stay in school are “remarkably influential” in increasing students’ long-term well-being. Of course, students themselves often fail to appreciate that fact: The study notes that young people usually fail to “make education attainment decisions in a way to maximize their human capital investment.” But in Great Britain and Ireland, where school-leaving laws were changed in the 1970s (raising the minimum “leaving age” to 16), “students compelled to take an extra year of schooling experienced an average increase of 12 percent in annual earnings.” Moreover, a one-year increase in schooling translated into a lower probability of poor health outcomes, a higher probability of good health outcomes, a greater likelihood of working in high-skill occupations, and a lower likelihood of being unemployed. State of the Union speeches are notorious for unfulfilled promises and forgotten initiatives. We hope this idea proves to be more than a rhetorical gesture.