The development of around 5,000 two-year-olds will be followed until the end of Key Stage 1 in the eight-year £5m Study of Early Education and Development - known as SEED.
The longitudinal study will also look at quality in the early years settings that are being used by the children taking part in the study. This part of the research is led by 4Children and early years academic Professor Ted Melhuish of Birkbeck College, who was the lead on the pioneering Effective Provision of Pre-school Education (EPPE) study.
Project director Dr Jane O'Brien, of the children and young people team at NatCen Social Research, who is leading the project, said that the study, which is worth £4.7m, shows a strong commitment from the Government to early years and to finding out about what needs to be in place for the sector to be effective.
She said, 'It's the biggest study since EPPE and one of the most expensive funded by the Department for Education.'
She added that the crucial difference between the EPPE project and SEED is that the new research will follow children, rather than beginning by identifying specific settings.
'We want to know the difference for children between receiving early education and not, and whether different "doses" of it and the type of setting make a difference, to form a more detailed picture from the child and family perspective.'
Letters have been sent out to around 8,000 families, based on a sample taken from child benefit records of children born between September 2010 and August 2012, with the aim of recruiting 5,000 children.
Researchers will arrange home visits with families that agree to take part, with interviews - which Dr O'Brien said would usually be with mothers - lasting on average 50 minutes.
'We're looking at the home learning environment in addition to any input from formal or informal childcare. We want to know everything about the family to build up a broad picture. We want to gather as much information as we can about the child, their family, and what sort of childcare and early education they use and how much,' she said.
'A key thing we will focus on is language development. Does your child recognise this word, or know it in another language? Can they say thank you, please, juice? How much TV do they watch? How many books do you have? How often do you read or sing nursery rhymes?'
Researchers will carry out return visits to the child's home at three and four and also add data from Early Years Foundation Stage Profile scores, the phonics reading test at the end of Year 1 and Key Stage 1 results.
'Hopefully by then we will have a rich sample of information on these children,' she said. The study sets out to answer questions such as how much effect can early years have on children's long-term education and outcomes, and whether it makes a difference if they start early education at two or three years old.
The research will involve three different groups of two-year-olds. The first group will be those children who were two on 1 September 2013 and who fall within the 20 per cent of disadvantaged two-year-olds who became eligible for the funding last month.
The second group will involve those children who will become entitled to the two-year-old offer when it is extended to 40 per cent of two-year-olds in September 2014.
The third group of two-year-olds will not be eligible for the two-year-old funded places and thereby act as a comparison group. This group therefore may or may not access early years education without the funding.
Dr O'Brien said, 'We're trying to evaluate Government policy as well. The Government wants to know if its policy is reaching disadvantaged two-year-olds and we want to see the effect on disadvantaged children compared with other children.'
Visits will be made to 1,000 settings, a sample of maintained, private, and voluntary settings, as well as children's centres and - for the first time in a major study, - to the homes of childminders.
To evaluate quality in group settings, researchers will use the well-known standardised measures of ITERS and ECERS-R, and a new measure for speech for two-year-olds NCKO, as well as new measures for interactions to evaluate quality in settings.
Twenty childminders who are offering the two-year-old places will be chosen as 'deep dive' case studies to explore their views and experiences.
Dr O'Brien said, 'We want to know how well the two-year-old offer is working for them from their experience and perspective.'
The first report will be published in spring 2014 on childminders and in autumn 2014 there will be the first baseline report.
- For more information, visit www.seed.natcen.ac.uk.