Earnings expectations of typical South African university of technology first-year students

Alex van der Merwe

Education Economics, 2011, vol. 19, issue 2, 181-198

Abstract: Human capital theory holds that a higher education will be pursued to the extent that its pecuniary rewards outstrip its costs. This notion is founded on the neoclassical economic assumption that expected earnings conditional on educational investment are accurately anticipated by those considering such investments. However, the evidence in support of this thesis is slim and, in the case of South Africa in particular, remains largely untested. This paper - the product of a qualitative study - reports the expected earnings data of Durban University of Technology first-year students who, on the whole, are evidently able to relatively accurately predict their commencing and medium- to long-term earnings. This merited the computation and analysis of expected private rates of return to educational investments which were found to be significantly related to study field and parents' educational attainment, useful knowledge in any description of higher education demand. More importantly, though, the paper argues, possibly somewhat controversially, that human capital theory may offer a more plausible explanation of individual higher education choice if it is unconstrained by its neoclassical economic framework.

Keywords: human capital theory; earnings expectations; expected rate of return; higher education demand; educational investment (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.tandfonline.com/10.1080/09645290903546462 (text/html)
Access to full text is restricted to subscribers.

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:taf:edecon:v:19:y:2011:i:2:p:181-198

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CEDE20

DOI: 10.1080/09645290903546462

Access Statistics for this article

Education Economics is currently edited by Caren Wareing and Steve Bradley

More articles in Education Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().