Consider the following facts:
1. Finnish children do not start school until they are seven years old. Most Finnish children do start day care from about the age of one, given that most mothers work.
2. Educational spending is a very modest $5,000 per student per year.
3. There are few if any programs for gifted children.
4. Class sizes often approach 30.
5. “Finland topped a respected international [educational] survey last year, coming in first in literacy and placing in the top five in math and science.”
6. Finnish teachers all have a Master’s degree or more.
7. Finnish teachers all enjoy a very high social status.
8. Reading to children, telling them folk tales, and going to the library are all high status activities.
9. TV programs are often in English, and subtitled, which further supports reading skills. (This should also serve as a jab to those who complain about the global spread of American TV shows.)
Here is the full story from The New York Times. Here is a general overview of the Finnish educational system, here is another. Here is a summary of the OECD study, with additional rankings and instructions on how to get a complete copy. Here is a story on Finnish economic competitiveness.
My take: The United States performs remarkably well when it harnesses status and approbational incentives in the right direction. We have done this for business entrepreneurship, but we are not close when it comes to education. When it comes to economics, we have to move away from our near-exclusive emphasis on monetary incentives.