Economics of Higher Education

Economics of Higher Education

Economic efficiency in Higher Education: The socially optimal market outcome is defined by economic efficiency, that is, no waste: changing the outcome cannot improve the welfare of any participant without reducing the welfare of another participant, perfectly competitive market outcomes exhibit economic efficiency.

Efficiency is one of the objectives of theoretical and empirical Modern Public Sector. In the case, of Spanish public sector, the 1978 Constitution states in Art 31.2 that: "Public expenditure shall make an equitable allocation of public resources and its programming and execution shall comply with criteria of efficiency and economy." Therefore, this constitutional mandate supports, from the legal maximum height, everything positive that can provide the promotion of economic efficiency. Similarly, in education, and therefore, in higher education the objectives pursued by the public sector can be reduced to two:

Produce efficiency (efficiency objective) and

A fair outcome (equity objective)

Education systems interested in the influence of education received by individuals after they have left schools and institutions training to carry out their adult life in society. These effects are two orders, in a narrow sense economic, social in a broader and can be read through two complementary dimensions: on the one hand individual, collective other. Educational policies can reduce poverty by increasing labor income and better educated workers. In such a situation, it is useful to about the returns to education for individuals with different levels of life and different countries. If the returns to education are high for the poor, fight poverty through policies to promote equal opportunities for access to school is an appropriate policy.

Conversely, if investment in education mainly benefits richer, while improving access to the education system may allow growth supported, but may also increase inequality in income distribution, without reducing Moreover, the incidence of poverty. However, objections and criticisms have been many made to the fact that education and productivity may be the only determinants of pay differentials between individuals. The initial models have been designed in a context of industrialized countries (mainly the U.S.) many authors have indeed shown that, particularly in the African context. Traditional theories advocating equalization of income levels between individuals in levels of human capital endowment identical not fit well with the existence of imperfect markets or segmented.

While education may have a different impact on earnings of labor affiliation sector and employment of individuals, it is also a determinant of choice individual upstream, i.e., when the decision is made to fit market work, particularly in one area over another. It is commonly recognized that observable individual characteristics (such as human capital in general), but also unobservable individuals, influence both of these decisions to participate and the level individual earnings. We can expand the range, and refinement of the indicators commonly used to evaluate the effectiveness of education for integration into the labor market in West Africa.

In particular, our goal is to re- estimate the determinants of labor income, in particular the effect of education, but differentiating individuals according to their area of ...