Szacowanie wewnętrznej stopy zwrotu inwestycji w wyższe wykształcenie

Adam Adamczyk and Wojciech Jarecki

Gospodarka Narodowa-The Polish Journal of Economics, 2008, vol. 2008, issue 11-12

Abstract: Surveys conducted in some of the world’s most developed countries have demonstrated that there is a positive relationship between the level of education and the level of income, Adamczyk and Jarecki write. According to the human capital theory, this effect is due to the growth of productivity. But education is also associated with costs. These costs can be divided into the direct costs of studying and opportunity costs. Thanks to the existence of measurable costs and effects, it is possible to assess the profitability of education. In order to measure the effects of investment in higher education, under the human capital theory, it is necessary to use a function in which the dependent variable is the level of income and the independent variables are age, education, and professional experience. However, this method cannot be used to determine whether or not studying is profitable, because it does not consider the costs of studying, Adamczyk and Jarecki note. They evaluate the profitability of investment in higher education in 2002, 2004 and 2006 using the internal rate of return (IRR) method. The IRR method is commonly used to evaluate the profitability of companies’ long-term investments. It makes it possible to take into account not only the level of effects and costs, but also the moment when they appear. A key advantage of this method is that it makes it possible to compare the effectiveness of investment in education with other kinds of investments, the authors say. The evaluation made by the authors showed that the rate of return was lower than 15 percent but higher than 16 percent, which means it was higher than the risk-free rate of return. In all, the obtained results show that investment in higher education in Poland is profitable. The analysis also demonstrated that the profitability of investment in higher education depends on sex. Men can obtain a higher rate of return than women. Another conclusion is that the profitability of studying can be affected not only by the income level but also by its time distribution.

Keywords: Financial Economics; Teaching/Communication/Extension/Profession (search for similar items in EconPapers)
Date: 2008
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/356620/files/Jarecki.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:polgne:356620

DOI: 10.22004/ag.econ.356620

Access Statistics for this article

More articles in Gospodarka Narodowa-The Polish Journal of Economics from Szkoła Główna Handlowa w Warszawie / SGH Warsaw School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().