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Human Capital (Human Capital Investment (Social IRR (Costs and benefits to…

- - - - The cost of foregone earnings RISING - depressing the rate of return to education 'r'
  - - - Includes:
        Opportunity cost of having people not participating in the production of output;
        Full cost of the provision of education
- - - - No shortage of graduates but rather those with lower level vocational skills
      - Social benefits from providing vocational training - case for higher public spending to tackle more basic skill shortages
    - - Fall in gradaute premiums from increasing enrollment
        
        Graduates taking roles that dont require degree
        
        Mistake to fund public expansion of HE
        
        No fall in graduate markup compared to school leavers - demand keeping pace with supply
    - - Maintains standards & quality of teaching, & reputation of UK universities
        
        Oxford #1 in world :star:
      - Universities more responsive by having fees
        
        'He who pays the piper calls the tune'
    - - Investing a lot of money (debt) for 3 years of HE so you value it more rather than doss about
    - - Signal to employers that graduates have a higher capacity
        
        Higher productivity
        
        Higher salaries
        
        financial gains made from a HE degree then FAIR to pay part of the cost
- - - - Longer period for flow of enhanced discounted earnings to offset costs
    - - Incentive to heavily invest young
    - - HC deteriorates - earning increases at a decreasing rate
  - - - Higher ability person = higher productivity = commands higher wage
      - Through higher earnings - more able people - higher IRR to a given level of HC acquisition than less able
  - - - Same ability & same set of IRR - wealthy face lower marginal financing costs than poor
    - - differences in discount rate reflective of wealth and ability
- - - - Higher entrance criteria with higher potential productivity?