Cost-Benefit Analysis of EducationIntroduction
Cost-benefit analysis is a very important concept in the establishment of investment as it reduces the prevalence of risks in the advent of undertaking given investment. While this statement hold, Education is perceived as a future investment in the learners while very little if any effort is taken to measure and control the investment. Similarly, there are fewer if any methods used to measure and account for the cost and the benefits of education in a systematic way. This leads to a momentous controversy of the costs of education versus the regarded benefit of the same. While education is an important asset in an individual, the cost of education ought to be verifiable as well as the benefits it creates upon acquisition. This means that individuals and the government must establish concrete measures that demonstrate the quality, values, benefits and the costs attributable to one system of education or the other. In this regard, this paper focuses on the case of two girls where one decides to upgrade and advance their studies after high school while the other decides otherwise.
Part: I. Analysis of the Project
In the case scenario, the two girls are initially involved in an academic dilemma. The two are found in a situation of forcible decision making in a bid to establish a central impact to their professional life in future. The two decisions that the two individuals end up making are sober according to the reasoning of each while at the same time have agitating repercussions either in the short-run or in the long-run. From the midterm project there are a number of issues that rose from the identified effect of each decision pertaining to short-term and long-term effects. From the project, the analysis focused on the cost benefit ratio between high school sciences and their impact free from advancements both in the short-run and in the long-run.
Ideally, the short-run benefits are relatively high for the high school coverage and utilization free from advancement. In fact, the benefit over-runs the benefits of a similar case of advancing students. The main reasoning behind this is the short-run returns to the high school education. While the student taking advancement in further studies remains predominantly a ‘spendthrift’ as opposed to earning, the other case is productive in another capacity in the workplace utilizing the high school educational endowment. This is a conceptual ploughing back of the investment of the former high school student who immediately gets into the workplace after school and begins to utilize their knowledge. However, the level of this investment (high school education) is considerably low and therefore subject to constrained returns. In an ordinary situation, the wage value of the high school student working as a secretary is considerably low. Besides, the high school education provided the personnel with general knowledge of what it take to exist in the ordinary economic environment while did not offer any special skill for professional undertaking. This implies that the individual operates as untrained personnel and therefore subject to salary constraints by mere fact of being untrained.
From the project, it is clear that the return from high school education while concurrently another individual advances is relatively high. However, the wage of the personnel after high school education is subject to stagnation at the lower level due to lack of special skills to the area of operations which implies that the individual is high susceptible to low salary as a matter of being untrained. However, at the same time, the other individual taking advanced course is increasing his specialty and professionalism in specific areas taking the dimension of sciences. Meanwhile, the person is earning very little returns to their studies due to lack of job placement while pursuing studies. However, this individual continues to advance studies through increased coverage of more advanced skills and specializing their line of study level after the other. This is the slow upgrade to a professional. The education policy provides for the job placements based on skills and expertise in the area of specialization. One of the key assumptions in this case is that no unskilled workforce can earn higher than a skilled counterpart. The less advanced girl also postulates that having not spent any resource on the academic advancement, this would spare her the costs compared to her counterpart who spends lump sums in the college advancements.
Nevertheless, in the long-run, the individual taking advanced training in the university degree begins to earn considerably higher pay perhaps through attachment or other after school job placement. However, when the person decides to upgrades further to a specialist-pediatrician based on the above assumption pertaining to specialization, their salary increases considerably. This is the point where the individual becomes a professional. Concurrently, their counterpart who remained at a secretarial job persistently have stagnating costs as they do not pay for any fee in the workplace as opposed to the colleague who have to pay for tuition fees, exams and other external costs. As they advance, they also have to pay for additional costs of such issues as licensures for authorization to operate in the public domain or to serve the public in the context of their specialization.
Besides, there are certain benefits that natural occur as honorary benefits for stay or motivation for work. These are however limited and determined by the wok placement managerial staffs which implies may be dispensed or not while the regularity of the dispensation is not yet guaranteed. However, in the end result, they end up revamping the salary of the individuals in such position regardless of their academic proficiency. In this regard, the girl under such placement in an untrained position of a secretary is liable to benefiting from such advances but the benefits are also constrained.
While the other girl advances through her studies to become a pediatric, the amount of pay through direct policy stipulation is high while other benefits formerly enjoyed by her counterpart having not advanced also follows. The main impact of this scenario is increased gross salary. Similarly, at such point in time, the expenditure or costs accruing the functionality of the advanced girl-professional also declines as a result of completed payment of school fees among other expenses. In particular, the overall effect occurs comprises of a scenario where the expenditure declines with increasing salary or returns meaning that the overall net benefits increase in the long run. In comparison with the counterpart case, the salary increases is also attached to increased allowances which the less advanced worker may never enjoy.
Another major outcome preceding the increased salary in the advanced professional is that with advancement from college to biochemistry prior to specialization, the benefits accruing to this stage are also increasing as the individual increases their professionalism and can work as they advance. However, this scenario is also ambiguous in lateral terms since, while the salary level is rising, the net benefits are decreasing. However, the reasoning behind this is that advancement in education leads to increased costs of sustaining academic activities. This implies that despite the rise in the aggregate benefits, the net benefit may remain constant or decline as in our case scenario due to increase in the costs which may exceed the ration of increase in income. However, after completion of studies and subsequent specialization, the costs attributable to studies are abruptly short-lived while the salary is either increased immediately or gradually.
The impact of this scenario is increased gross benefits and a proportional increase in the net benefits with reduced expenditures or costs. The main assumption in this case however, remains that the advancing student is employed after completing undergraduate degree in physics and later on promoted after completing the specialized training as a pediatric as per the educational curriculum. Similarly, the benefits of the untrained personnel also rises gradually till a certain level where it starts to decline perhaps with the influx of professionals to take over their jobs as trained personnel. This could be a former colleague who took studies in the line of secretariat and advanced to become a certified public secretary. Assuming that the criteria of job placement is government by academic achievements, the trained personnel directly takes over or takes a supreme role in the same organization where the untrained worker becomes an assistant by virtue of experienced garnered.
Part (II): Discomfort Level
One of the assumptions made above is that the untrained personnel will have stagnating salary over the course of time. This may not be the case. For instance, there are always certain privileges that are constituted within an organizational framework such as seminars for advancement of skills. Besides, various individuals believe that practical experience is far better than the theoretical performance. In this regard, it does not make logical sense to imply that the student who does not advance their study will have a parallel wage free from advancement. In essence, advancement may also come as a result of other technical courses that could be taken while still pursuing their workplace dispensation. As a result, it is wrong to assume a flat salaries or salary with a downward curvature destined to decline in the long run. Besides, it is also illogical to assume that advancement in education will result in an automatic promotion in the workplace or immediate securing of job placement and thus, earning beginning immediately. On the contrary, the person advancing in education may take years or even life-long before securing employment or even having a chance to become self-employed. This means that the salary advancement assumed to occur immediately may never be the case as such may only mean a luck considering the current provisions of the academic curriculums.
For instance, researchers have been investigating the Fiscal impacts either positive or negative attributable to the advancement placement programs. The programs may allow students to get college credit for undertaking advanced coursework in a high school level and further to college. There are also network economists who specializes in particular areas such as health while other venture into labor in order to assist in taking up certain projects. In this regard, the returns on professional mileage from may not be guaranteed. As such, the economist focusing to promoting the performance of certain health projects may not have a pre-determined returns and their fate relative to the less advanced colleagues may be incomparable. In certain circumstances, given a scenario that such economists operates in a hospital environment where a less advanced colleague operates a secretary, this would only imply that chances are that the economist would operate under the high school drop out to give recorded instructions either directly or indirectly. Besides, the economist may be forced to report to the secretary, either directly or indirectly, as the secretary acts as an intermediary between the management and the outside environment.
While the cost-benefit analysis has a major consideration for business research, environmental studies, healthcare sectors and the national security among others, the impact of the analysis is less guaranteed or predictable within the educational setting. However, advancement in education increases the probability of success and perhaps economic success given the notion perpetrated by academic curriculums of education where the more learned or advanced an individual, the more acquitted to high pay jobs placement they are. Experts therefore recommend a none-cost-benefit analysis consideration in of benefits attributable to advancement in education versus less no advances in education.
Indeed, the concept of high capacity of advanced studies relative to less advanced case lies within many variable factors. For instance, for quality of education product to be achieved, the effectiveness of the system of education must be guaranteed an aspect that presents critical challenges of achievement I real-life situation and the education sector in particular. Indeed, the analysis of the effectiveness of study program such as the advanced girl to becoming a pediatrician requires sophisticated conceptual study framework which puts into consideration both intimate internal factors as well as other external influences that may impact on the effectiveness of an education program.
Another major reason that may limit the cost-benefit analysis of the educational coverage impact as observed by experts claims that educators are not comfortable with talking about costs. Essentially, the cost of education is principally high relative to any other investment with a very high potential of risk with unguaranteed return to investment of effectively predictable returns by virtue of time. For instance, some thinkers also express concerns on any possibility of attaching some sort of costs to the intangible aspect of good schooling or advancement in education. In lateral terms as well, it is critically hard to attach some accurate costs or benefits to good schooling or programs thereof. This may be hard to gauge as to being a civil society or good life as a result of schooling. In this regard, this implies that the tangible benefits attached to the schooling process or other costs are subject to erotic prepositioning. Indeed, some researchers also argues that very little if any is known as per the ongoing processes within classrooms. Furthermore, the learners who might be quite are of the sub-standard qualities of the education programs may never reveal about it as such may be a prospective move to belittle their own composure or what may be perceived as gains. However, while this fact remains, there has been consistent rise in the economic constraints an aspect that has pressed down the academic personnel to put into consideration the costs attributable to learning which has long been hidden and virtually unknown. In this regard, the decision makers have been demanding for the provision of measurable outcomes from the schooling practice. Indeed, researchers have observed that majority of the people have therefore grown more confident to talking about the grade per their achievements or the graduation rates as opposed to earlier cases. However, the irony behind these achievement whether publicly exposed of left out in secrets is that the social-economic impact of the achievement in education is not guaranteed to be directly proportional.
However, policy framework has tended to reorganize the general condition and position held by the academic achievements. For instance, partly as a result of the Federal No Child Left Behind Act in US that demands that states have to maintain good track of their students, academic ‘journey’ many of the states have also advanced their measures in building a rational large-scale database which makes the cost benefit analysis of education more applicable or doable. This is a method that has resonated with many people. For instance, the Growth and Justice Group located in Minnesota also commissioned a team of economists researchers into finding out the proposition of the contemporary effective strategies that can be adopted from the birth of a child to college study with an appropriate measure of the costs and benefits attributable to the study in order to raise a post-secondary achievement. Besides, the team was also tasked with the object of understanding the cost of the identified strategies in actual public dollars. This by virtue of perception was an incredibly hard task for the team and in real-life situation.
Indeed, the cost-based analysis may assist in establishing an argument contrary to the aspect of many individuals and organizations asking for more. In a broad economic perspective, states have also been investing heavily on education advancement without due consideration of the benefits that some of the investment go into. For instance, researchers in some developing countries have expressed concerns on the credible efforts that have been put in developing the geospatial engineering and space technology while other have developed the modest study platform in advanced curriculum. Essentially, one of the arguments behind this state of mind is that while the governments invest lump sums in such educational curriculums, the returns are considerably low while majority of the learners end up in brain drain to other developed countries where they execute their proficiency in the field of expertise with little if any benefits to the mother countries. The other major assumption that was taken is that the unused resources do not have costs on the individuals or the country. However, on an economic perspective, they have. For instance, an instance of an empty classroom may be leased out to dancing class or even used to house a computer laboratory. In any case, if one assumes that the unused resources have no costs, then, this means they ignore the alternative uses that such can be put into.
In addition to estimating or imagining the actual costs of the programs, the costs attributable to education may be having other additional variables often overlook. Similarly, lack of investment in education sector may also imply a direct loss in potentially lucrative venture in future which may yield additional benefit to overcome the initial costs. Indeed, the controversy in the cost-benefit analysis of education may however, in the prospects of deciding which benefits and costs should be accounted for and the estimates to use in gauging some of the intangible variables of education. Indeed, many scholars often contend that their respective estimates are not reaped from the ordinaries but rather there is no any existing hard-and –fast procedure in education with which the expenses of education can be determined upon. Besides, the determination of whether a certain expenses is reasonable or not does not exist in the education sector as contested by most scholar. .
Part (III): Possible Extensions
Moreover, while the above literature downplays the essence and possibility of measuring the cost of education, the hypothesis of an existing benefit of education has often been proven beyond reasonable doubt. Essentially, education advancement just as in the case of the advanced girl in nursing studies increases the probability of well-ness in future pertaining to the individuals taking up the study. Ideally, the ‘fruits’ of education as majority of the people in the scholarly sector may refer to them are always sweet but the secret lies in the ‘sweat’. This proposition can be translated to make economic sense. While the cost of education might present a bitter and aching devotion, the results of education which entail advances and further development into a major economic player may overcome the ‘bitterness’ of the labored educational costs. Indeed, the costs of education further overstate the role taken by professionals in changing the life patterns of their areas of origin. For instance, in the political line-up, it is obvious that majority of the leaders arise from the education-oriented families that end up clinching the political seats for governance.
After my placement of the need and significance of accountability in education with regard to the costs, my decision holds that advancement in education provides both momentous and life-long benefits to the victims and the community at large. However, there is an agitating need for the people involved and the government to establish concrete framework upon which education can be verified with regard to the costs incurred during study as well as the advantages or benefits that it creates after completion. These two stages are critical to the measurement of the costs and the benefits that an individual incurs. Essentially, for the individuals to be able to proceed with education, they must be sensitive to any cost incurred while pursuing their studies and be able to justify the costs incurred in order to gauge the potential returns on the investment.
Besides, the rule of law also provides for equity in the distribution of national resources in most and virtually all democratic states. In this regard, the academic elites are responsible for benchmarking the areas that deserves the highest level of investment while in other cases; affirmative action is also applied to quench the overarching economic imbalances. Indeed, such measures results in achievement of equity and mutual coexistence amongst populations in a country an aspect that also breed peace and economic resilience of a region or a country. In this regard, while majority of the people may overlook education due to the underlying costs, the end result may bring about a turnaround as it forms an equally effective investment. Careful look at the aspect of education and the underlying factors can therefore results in the identification of tangible costs from the intangible factors.
Part (IV) Your Take
Finally, my main take-away from class is that education is an investment just like any other where economic principles, rules and theories also apply. For instance, there is much expectation in terms of returns to investment when it comes to education but the tangibility of the investment and the regarded returns places a significant controversy on both individuals and the education system at large. With regard to an individual, this analysis provide me with a conviction that individuals pursuing education must be sensitive to the costs payable to education both physical costs as well as opportunity costs of taking education as opposed to taking a job placement such as in this case scenario of two girls.
Besides, this analysis also creates an assertion in my mind that economic applies everywhere, be it formal or informal investment segments. In this regard, individuals and the government must always provide for an accountable development path in the prospects of achieving what may be considered, advanced education levels. Besides, this creates a concern on the hidden costs that are prevalent in the pursuit of education which is one of the main factors that makes accountability of education investment quite challenging and near impossible in many cases.
Consequently, both individual and group decision making to pursue education must be founded on the consideration of the costs for the case of individuals and the effectiveness of the education systems for the case of group decision making. For instance, the government may establish decision to invest or not to invest in education based on the expected effectiveness on the system. The mechanism or approach taken towards educating the community should also be considered with regard to the costs it creates and the benefits it is intended to bring on board. Some approaches are more expensive than others due to bureaucratic procedures involved.
Conclusion
Finally, while education is regarded as an important asset to individuals and communities, all the stakeholders in the sector must be sensitive to the costs and expected benefits of the given curriculum in order to make wise decision on the best approach to take in education. Besides, the perception of education as an investment is also essential to the reduction of unnecessary costs that are attributed to impulse expenditure on matter that could have otherwise been regulated. This includes excursion trip during holiday with colleagues and other modest way of relaxation. While it remain challenging and controversial, costs-benefit analysis is also an essential undertaking in the education sector.
