Returns from education, Microeconomics

Assignment Help:

Returns from Education

Monetary benefits from education are called as returns. Such benefits accruing to an individual are called as private returns. The sum of all private returns together with the taxes on income paid by individuals is known as social returns. In the context of education, costs for various courses are first calculated. Returns to these courses over a life time are then computed based on factors like total years of working (i.e. working span), expected or average returns or earnings, etc.

The life time returns are then calculated for unit costs or per unit of expenditure. Two techniques are followed to calculate rates of return to different levels and forms of education. They are: the Net Present Value (NPV) technique and the Internal Rate of Return (IRR) technique. There have been a large number of studies using particularly the IRR technique to compute the economic value of a variety of educational courses. A comprehensive review of these studies was made by Psacharopoulos and Hinchcliffe in 1973 and again updated in 1985. As per this international update on findings of studies on rates of return from sixty countries, the following inferences have been drawn.

a) Social rates of return are lower than private rates of return;
b) Social rates to primary education are higher than those to secondary and higher education;
c) Social rates for developing countries are higher than those for developed countries;
d) Social rates on investments in education are higher than social rates on investment in physical capital (industry, trade, etc) for developing countries.


Related Discussions:- Returns from education

Need answer as a assignment right now please, Consider what would happen if...

Consider what would happen if a taxes of 10000$ was imposed on imported automobiles on dealers.Using a demand and supply diagram, show its impact of price and quantity. Suppose the

Direct and indirect benefits, Direct and Indirect Benefits Life time e...

Direct and Indirect Benefits Life time earnings of an educated person is an instance of direct benefit from education. Skills produced in training or extension programmes in a

Restrictions on international trade, Protection against dumping: It co...

Protection against dumping: It could be looked at as the export of commodities priced below cost of production. Dumping is generally looked upon as an unfair trading practice

Allocation of a countrys resources to the price mechanism, What are the adv...

What are the advantages of leaving the allocation of a countrys resources to the price mechanism? Ans) The main conditions needed are: 1. Either a finite number of agents or pr

Oligopoly, what is The most important source of oligopoly?

what is The most important source of oligopoly?

#title., if the marginal production of labor is rising, is the marginal cos...

if the marginal production of labor is rising, is the marginal cost of production rising or falling? Briefly explain

Concept of supply, #question.using a well illustrated diagram, explain the ...

#question.using a well illustrated diagram, explain the concept of producers equilibrium .

Complementary slackness condition, Consider the following linear program in...

Consider the following linear program in primal form and develop the dual formulation in a detailed manner. Use matrix notation in developing the dual. Clearly express all the dual

Explain and illustrate the concept of opportunity cost, Question 1: (a)...

Question 1: (a) Discuss the adjustment to an increase in demand for a perfectly competitive market in the: (i) Short run (ii) Long run (b) How would the same industry

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd