Cost Modeling for Child Care: Illuminating State Policy Strategies

Cost models—a generic term for tools that help estimate expenses and expected revenue for businesses operating under certain conditions—can provide a significant amount of data to assess early childhood initiatives. Depending on the design, cost modeling tools can inform a variety of investment and improvement strategies.

As states seek to invest in cost modeling tools, early education providers and funders must think strategically about how the tools can best be used.

BPC’s explainer outlines how cost modeling tools can help answer some of the most pressing questions facing the early education field. It focuses on three key areas:

1. Identifying current challenges facing the early childhood sector and explaining how cost modeling can help answer critical questions about designing sustainable solutions.
2. Providing concrete examples of how cost modeling tools can help drive strategic initiatives.
3. Outlining a set of questions for policymakers to ask when they are developing cost models.

BPC’s early childhood team offers a toolkit to help states effectively leverage cost models. Download our explainer to learn more.

For BPC’s recommendations on why child care needs both cost modeling analyses and market rate surveys, check out Using Cost Modeling to Design New Solutions for Child Care.