The impact of human capital investment on the wages among Northern Border University graduates

Naif Fawzi Alruwaili ()
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Naif Fawzi Alruwaili: Northern Border University, Saudi Arabia

Access Journal, 2024, vol. 5, issue 3, 551-561

Abstract: Objectives: This study explores how investing in human capital through higher education affects wages of graduates of Northern Border University. Methods/Approach: To that end, it estimates the Mincer earnings function, a commonly used method to calculate the economic return of investing in education. The study analyses data collected from a questionnaire completed by 305 individuals who graduated from Northern Border University and are currently employed in the Northern Border region. Results: This study yielded various findings, with the most significant being the enhancement of economic return resulting from investments in education. Additionally, the research findings indicate that the return on investment in higher education for all employees is about 5.6%. Another important finding of the study is that there is a noticeable disparity in wages between the public and private sectors. The Mincer earnings specification indicates that the return on investment in education accounts for 5.9% in the public sector and 4.1% in the private sector. Finally, the return on investment in higher education for employees in the services sector, including education, health, banks, and insurance, is 5.7% and exceeds the 2.8% observed in the trade sector.

Keywords: Human Capital; return of education; wage; Saudi Arabia (search for similar items in EconPapers)
JEL-codes: C83 H75 J3 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:aip:access:v:5:y:2024:i:3:p:551-561

DOI: 10.46656/access.2023.5.3(10)

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