1887

OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

Investment in Human Capital Through Post-Compulsory Education and Training

Selected Efficiency and Equity Aspects

This paper examines various efficiency and equity aspects related to the skill acquisition of young people and older adults. The analysis suggests that such human capital investment is associated with significant labour-market gains for individuals, including higher post-tax earnings and better employment prospects, which exceed the investment costs, mainly foregone earnings and tuition fees, by a significant margin. It also shows that the net benefits are strongly influenced by policy-related factors, such as study length, tuition subsidies and student support. Overall, the estimates reported in the paper indicate that there are strong incentives for the average student to continue studying beyond the compulsory schooling age, and also point to the benefits of such investment in education for society as a whole. However, the net gains fall with age, mainly reflecting a shorter period to take advantage of the benefits that come with education. Finally the paper notes that students ...

English

Keywords: earnings, human capital, student support, taxes, unemployment
JEL: I21: Health, Education, and Welfare / Education and Research Institutions / Analysis of Education; D63: Microeconomics / Welfare Economics / Equity, Justice, Inequality, and Other Normative Criteria and Measurement; I22: Health, Education, and Welfare / Education and Research Institutions / Educational Finance; Financial Aid; I28: Health, Education, and Welfare / Education and Research Institutions / Education: Government Policy
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