http://www.businessweek.com/articles/2014-04-07/why-education-spending-doesnt-lead-to-economic-growth
In the us today education leads to higher wages. The median weekly earning for someone who has under a high school diploma was about 470 dollars that number rises to a little over a 1000 with a bachelors degree and to 1700 with a professional degree. This shows that schooling is worth it but does all this private investment boost the economy.
In the us public education expenditure takes up about 5% of GDP but in other countries like Kenya and Ghana education takes up nearly 15%. Public education spending is justified that increased education benefits the society. Some experts accountant for a 10% increase in GDP 1915 to 1999 because of increased educational attainment among Americans.
This is such a hot topic, especially for us as college students. However, I haven't read an article like this one yet. It is really interesting that at a global level, there has been no relationship found between a more educated population and and more rapid economic development. It seems to be it now comes down to how you will use your opportunities in the most beneficial way possible.
ReplyDeleteThe second half of the article focuses on the fact that even large increases in education do not translate into large increases in GDP. This may be because for people who are planning on working for an employer work harder than if they would be working for themselves. This attribute could be signified by the number of people who go to college, suggesting that those who do not go to college may not have the same ambition even working for an employer. However for self-employed workers, they are not working to impress anyone or keep a job because they are their own boss. Basically, college really only benefits those who are not self-employed; for those who do become self-employed, the effects of completing college on your annual income are minimal.
ReplyDeleteI came across this article, had some very good points in it. I think that it is good that the government funds public education, but it needs to find jobs so that education pays off and increases the GDP. The examples that they use in the article really do show that there is no correlation between a educated population and more economic development.
ReplyDeleteI think population is a major factor. Most developing economies have a huge population and the government can afford spending only on primary education. The government cannot afford for higher level of education. Thus even though many kids go to school, they do not have adequate skills needed to find a job.
ReplyDeletePoverty, cultural and social beliefs also affects the economy.
In developing countries ,the reason many parents don't send their kids to school is because they think this investment is a waste. Their kids can join the family business or if their daughters are married off then this investment of education will reap its benefits to the daughters in laws family.
The problem for many people is whether or not to gamble paying a fortune for college tuition and hope for a higher return of investment. For a lot of Americans, they are in debt from college for countless numbers of years, and don't start actually making money until then. Higher education creates higher pay, but that certainly depends on the job field you are selecting and the salary that accommodates it. I would still think it's worth it to go to college now, but I think the gap is closing. Eventually, there needs to be a law passed that caps how high tuition rates can be, because this is getting to the point where middle-class families can barely afford it.
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