Returns on Education in the World

RETURNS ON The overall economic benefits of education can be assessed by estimating the economic value of the investment in education. The Organisation for Economic EDUCATION IN Co-operation and Development calculated total costs and benefits associated with education for 25 countries around the world. The calculation of costs THE WORLD include public and private direct costs, as well forgone earnings while in school. The benefit components include earnings, taxes, social contributions, and social transfers, as well as differences in the probability of finding work. Total Costs and Benefits of Education (countries ranked by total benefits) Men Women Total benefits varied from about $10,500 in Estonia to over $140,000 in Austria. Those benefits were offset by costs that ranged from about $9,300 in Turkey to $54,40o in Norway. Total benefits varied from about $11, 200 in Korea to about $103,500 in Germany. Those benefits were offset by costs that ranged from about s9,700 in Norway to $54,400 in Norway. Gap between total costs and benefits (U.S. dollars) Gap between total costs and benefits (U.S. dollars) Total benefits $140,896 Total costs Total costs Total benefits $50,967 Austria Germany $39,820 $103,454 Denmark Austria Ireland Sweden Norway United Kingdom United States United States Sweden Italy United Kingdom Norway Italy Denmark Portugal Hungary Germany Slovak Republic Slovak Republic France Czech Republic Portugal Hungary Czech Republic Canada Slovenia France Australia Slovenia Ireland Israel Finland Finland Canada Australia Spain New Zealand New Zealand Spain Poland Korea Turkey Poland Estonia Total costs exceed total benefits (line denotes total benefits) Turkey Total costs exceed total benefits (line denotes total benefits) Israel Estonia Korea -20,000 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 -20,000 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 Components of Total Costs and Benefits (countries ranked by total benefits) Social Social contribution Transfers Unemployment Income tax Forgone taxes on earnings contribution Transfers Unemployment effect Forgone taxes on earnings Income tax effect Direct cost effect effect effect Direct cost effect effect effect -$50,967 -47,102 Austria $140,896 -$39,820 Germany $103,454 Denmark 110,987 106,855 -50,789 Austria 95.519 -26,113 Ireland -36,556 Sweden 82,821 -54,376 Norway 105,950 United Kingdom United States Italy Norway Denmark -14,932 77,072 -34,857 United States 101,944 -34,895 -44,952 72,932 68,530 68,310 -36,603 Sweden 91,012 United Kingdom Italy Portugal 86,990 82,418 76,420 72,082 68,395 -54.446 -46,670 -12,522 -43,183 -23,791 -18,696 62,453 53,865 Hungary Slovak Republic France -39.779 Germany Slovak Republic Czech Republic Hungary Canada -15,160 50,177 -15,995 -37,078 48,859 55,705 -22,779 -20,215 18,880 -27,018 Portugal Czech Republic 48,835 47.586 45,690 45,630 54,107 -20,221 52,101 -25,639 -19,163 -26,129 -28,111 -27,946 -20,989 -24,589 -21,219 Slovenia 49,027 48,543 -37.355 France Australia -25,562 -18,216 Slovenia Ireland 39.377 47,325 -45,521 -42,548 36,082 33,620 Israel 37,896 36,661 Finland -27.968 Finland Canada Australia New Zealand -19,027 Spain New Zealand 33,400 -24,653 -21,083 -23,887 -21,797 30,465 27,719 17,827 - 12,846 - 12,690 - 11,178 Spain Poland Korea 25,337 23,718 - 20,699 10,506 -9,668 -18,645 -18,173 -23,785 Turkey Estonia Poland -9.327 Turkey Israel -19,902 Estonia Korea -60,000 -40,000 80,000 -б0,00о -20,000 -20,000 -40,000 80,000 Author: Jonathan Schwabish ([email protected]; @jschwabish) Source: Organisation for Economic Co-operation and Development, Education at a Glance 2012: OECD Indicators, Table Ag.2, http://www.oecd.org/edu/eag2012.htm. Notes: All estimates represent public benefits and costs for an individual obtaining upper secondary or post-secondary non-tertiary education as part of initial education. Data are for 2o08 or the latest available year. All estimates are in equivalent U.S. dollars converted using purchasing power parities for gross domestic product. Publication Date: November 2012.