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The data contained in tax returns, health and welfare records could be a gold mine for scientists - but only if they can protect people's privacy.
In 2011, six US economists tackled a question at the heart of education policy: how much does great teaching help children in the long run?
They started with the records of more than 11,500 Tennessee schoolchildren who, as part of an experiment in the 1980s, had been randomly assigned to high- and average-quality teachers between the ages of five and eight. Then they gauged the children's earnings as adults from federal tax returns filed in the 2000s. The analysis1 showed that the benefits of a good early education last for decades: each year of better teaching in childhood boosted an individual's annual earnings by some 3.5% on average. Other data showed the same individuals besting their peers on measures such as university attendance, retirement savings, marriage rates and home ownership.
The economists' work was widely hailed in education-policy circles, and US President Barack Obama cited it in his 2012 State of the Union address when he called for more investment in teacher training.
But for many social scientists, the most impressive thing was that the authors had been able to examine US federal tax returns: a closely guarded data set that was then available to researchers only with tight restrictions. This has made the study an emblem for both the challenges and the enormous potential power of 'administrative data' - information collected during routine provision of services, including tax returns, records of welfare benefits, data on visits to doctors and hospitals, and criminal records. Unlike Internet searches, social-media posts and the rest of the digital trails that people establish in their daily lives, administrative data cover entire populations with minimal self-selection effects: in the US census, for example, everyone sampled is required by law to respond and tell the truth.
This puts administrative data sets at the frontier of social science, says John Friedman, an economist at Brown University in Providence, Rhode Island, and one of the lead authors of the education study1. "They allow researchers to not just get at old questions in a new way," he says, "but to come at problems that were completely impossible...