Education Is a Good Investment or Consumption

Topics: Higher education, Education, Economics Pages: 6 (2456 words) Published: November 11, 2012
Education can view as consumption and investment. A product or services is considered to belong to the consumption category when it gives satisfaction or utility in a single period only while, it is considered pure investment goods or services when it is expected to give satisfaction in the future periods only. Education is regarded as the most important determinant of a person’s economic and social success. In economy, terms of education is an economic good because anything that satisfies a human wants is considered a good. Consumption can be determined as simply paying the cost for a good or services and receiving all of the benefits for that good or services immediately. Education as consumption is education as a fundamental human right one of the right of every citizen in each country. It defined as consumption goods because a lot of the students could be said to be enjoyed the lectures and the homework given including the reading. This can be seen where many countries set the basic education that is primary and secondary school were used as compulsory education. Education is also seen as public goods. It considered as consumption as it motivated by a desires to satisfy the need for personal development, social needs, and also for the needs of knowledge for understanding. Higher education can be viewed both as a consumption good for which the individual is willing to pay, and as an investment alternative that yields higher wages later in life. Besides that, education is as an investment aiming to obtain greater net income or rate of return in the future. In other words, investment in education occurs when current consumption is sacrifice towards the purchase of education that is expected to give a higher level of benefits in the future. For instance, higher education level usually will provide higher future income and at the same time providing higher levels of future consumption. Education is an investment to increases the individual’s wage in the next period. As education is an investment, its assuming that man is a form of capital and capital is important to the growth of productivity of the country. Therefore, education cost is viewed as the amount of money bought to acquire or invest in a number of human capitals that can expand the country economic capacity in the future. Some example of cost of the investment for education is sum of the direct costs, such as tuition fees, books and other expenses, and forgone labor income if they choose to work rather than study. Higher education enables the individual to choose from a broader aspect of jobs that are mostly considered more interesting and more challenging. Higher education makes the individual more flexible in the type of job he is able to perform, as well as to perform it, which provides insurance against unemployment. Person chooses the kind and length of education that maximize his income. EDUCATION IS A GOOD INVESTMENT

Education is a good investment. Which, investment in education can give more advantages and impacts to our self and our future? Furthermore, at same time investment in education can enhance economic growth. For instance, which some countries, for them investment in education take more years of schooling can earn more and get better jobs. Besides that, many schooling can also be a source of social mobility. In part, raising level the average level of schooling in their population can also improve productivity, raise quality of jobs in economic and increase economic growth. Education is one of the best types of investments and will bring many benefits to the individual and for the development of country. Level of education from pre-school right up to the highest levels is the main way to improve the quality of life of individuals, as the main goal of education was to produce high quality of labor. Education has significant impact on human life opportunities to gain and maintain the quality of life. Education can explain the...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • good Essay
  • investment in human resource (education) Essay
  • Is the Higher Education a Good Investment? Essay
  • investment in Education is a prerequisite for national development Research Paper
  • Good Education Essay
  • Education and Good Governance Essay
  • education Essay
  • Productive Consumption: Capital Goods and Productive Capacities Essay

Become a StudyMode Member

Sign Up - It's Free