I just came across this cool graphic from OECD, which represents the economic returns to education in OECD countries. The graphic shows costs and benefits for both private and public sources. Returns include increased earnings, taxes, and public benefits, while costs include direct costs and foregone earnings (private) and taxes (public).
- Returns are significantly higher for private sources than public sources (about three times as high across all OECD countries), while costs borne by private sources are less than double costs for private sources. This seems to suggest that the return on investment is greater for private investors. An implication might be to enhance public-private partnerships and to explore alternative financing mechanisms, such as so-called “Pay For Success” bonds, which allow the private sector to invest in public programs.
- Across all countries, returns for women seem to be significantly lower than those for men, especially in the private sphere — although the costs are similar. This is a counterintuitive finding, as one might expect girls to gain more from interventions because they are less likely to have access to educational opportunity. Iin developing countries with greater gender disparity, however — such as Turkey – education investments for women do, in fact, have greater returns than for men.
- Although developing economies such as the Czech Republic and Turkey realize lower benefits in absolute dollar figures, the benefit for these countries relative to costs seem higher than for developed economies. If more analysis bore this out, this finding would align with the results of effectiveness in the U.S., which find particularly impressive gains for at-risk children.
See the whole blog post on the contest from OECD here .