RateofReturnonEducation

1.ReturnonEducationfortheTop5andBottom5OECDCountries
Uppersecondaryorpostsecondarynontertiaryeducation:Basedonthedifferencebetweenthose
whohavenotattainedthatlevelofeducation.
NetPresentValue(ThousandsofUS$)
$0

$250

InternalRateofReturn

$500

0%

UnitedStates
Ireland
SlovakRepublic
Austria
UnitedKingdom
OECDAverage
Poland
Turkey
NewZealand
Finland
Estonia

30%

60%

UnitedStates
Portugal
Hungary
Slovenia
Ireland
OECDAverage
Turkey
Sweden
NewZealand
Estonia
Denmark

$204
$197
$176
$168
$161
$106
$49
$32
$31
$31
$25

23%
18%
17%
17%
16%
11%
7%

EU21/OECD28Country
OECD28Country

6%
6%
5%
5%

TertiaryEducation:basedonthedifferencewiththosewhohaveattainedanuppersecondary
orpostsecondarynontertiaryeducation.
NetPresentValue(ThousandsofUS$)
$0
$250
$500

InternalRateofReturn
0%
30%
60%

UnitedStates
Portugal
Hungary
Slovenia
Ireland
OECDAverage
Turkey
Sweden
NewZealand
Estonia
Denmark

UnitedStates
Ireland
SlovakRepublic
Austria
UnitedKingdom
OECDAverage
Poland
Turkey
NewZealand
Finland
Estonia

$116
$105
$88
$86
$77
$54
$23
$22
$21
$18
$11

28%
15%
14%
13%
13%
10%

2.FactorsContributingtotheNetPresentValueandRateofReturn:Costsvs.Benefits

7%

DirectCostsexpenseincurredtoobtain
acertainlevelofeducation
ForegoneEarningslostwagesduring
theadditionaltimespentoneducation

7%
7%
6%
6%

GrossEarningsBenefitspremiumingrossearningsfromadditional
educationoverthelifetimeofaparticularindividual.
IncomeTaxEffectadditionaltaxespaidbyindividualscompletinga
higherlevelofeducation.
SocialContributionEffectactualorimputedpaymentsto
socialinsuranceschemestomakeprovisionforsocialinsurance
benefits.E.g.socialsecurityschemes

Cumulativeprivateandpublicnetpresentandvaluerateofreturn,calculatedusingtheaveragevaluesbetween
menandwomen.InequivalentUSDconvertedusingPPPsforGDP(2008orlatestavailableyear).

TransfersEffecttransferofincome,fromonegrouptoanothere.gfromtheaffluent
tothepoor;anincreaseinindividualincomecanresultinagreatersocialcontribution
andinturnincreaseasocialtransferviathegovernment.
GrantEffectsgovernmentexpenditureongrantstoimproveincentivesandaccessto
education
UnemploymentEffectmonetarybenefitassociatedwiththereducedriskof
unemploymentduetothecompletionofhighereducation.

3.EstimatingTotalCostsandBenefits
Calculatedusingtheaveragevaluesbetweenmenandwomen.InequivalentUSDconvertedusingPPPsforGDP(2008orlatestavailableyear).Totalcostorbenefits=Public+Privatecostorbenefit.

TotalBenefit

(ThousandsofUS$)
$600

PublicBenefit
NonTertiary

Tertiary
PublicCost

TotalCost

$300

Benefits
$0

Costs
($300)
United
States

$500

Portugal

Hungary

Slovenia

Ireland

Czech
Republic

Austria

Poland

Belgium

Italy

Germany

United
Kingdom

Netherlands

Slovak
Republic

Korea

France

Canada

Australia

Israel

Finland

Japan

Spain

Norway

Turkey

New
Zealand

Sweden

Estonia

Denmark

TertiaryEducation
NonTertiary Education

Net $250
Benefits
$0
(ThousandsofUS$)

4.FactorsContributingtoNetPresentValueandInternalRateofReturnonEducation
Calculatedusingtheaveragevaluesbetweenmenandwomenfortheindicatedgroup.InequivalentUSDconvertedusingPPPsforGDP(2008orlatestavailableyear).
Foregone
Earnings

DirectCost
($50)

($25)

SocialContribution
Effect

Unemployment
Effect

TransfersEffect

NetPresent
Value

GrantsEffect

TertiaryEducation
PublicCost

T-Pb-E-F

NonTertiaryEducation
PublicCost

NT-Pb-E-M

NonTertiaryEducation
PublicCost

NT-Pb-E-F
T-Pv-E-M

TertiaryEducation
PrivateCost

T-Pv-E-F

NonTertiaryEducation
PrivateCost

NT-Pv-E-M

NonTertiaryEducation
PrivateCost

NT-Pv-E-F

$200

$100

$100

($150) ($75)
Column2
Column3

NT-Pv-E-M

NonTertiaryEducation
PrivateValue/Return

NT-Pv-E-F

NonTertiaryEducation
PrivateValue/Return
TertiaryEducation
PublicValue/Return

T-Pb-E-F

$0

$0

TertiaryPublic

DirectCost

TertiaryEducation
PrivateValue/Return

T-Pv-E-F

TertiaryPrivate

ForegoneEarnings
$0
($150) ($75)
Column4
Column5

NT-Pb-E-M

NonTertiaryEducation
PublicValue/Return

NT-Pb-E-F

NonTertiaryEducation
PublicValueReturn

($100)
Chart showscumulativeeffectofspecifiedfactorsleadingtoNetPresentValueestimate

(ThousandsofUS$)

NonTertiaryPrivate

TertiaryEducation
PublicValue/Return

$300 T-Pb-E-M

$300

($100)

EU21/OECD28Country
OECD28Country

TertiaryEducation
PrivateValue/Return

T-Pv-E-M

$200

TertiaryEducation
PrivateCost

$100

InternalRateofReturn
10%
20%
$200 0%

$400

$400
T-Pb-E-M

Column1

IncomeTax
Effect

$0

$0

TertiaryEducation
PublicCost

NonTertiary Public

GrossEarnings
Benefits

$0
Column6

GrossEarnings
$0

Column7

$300

SocialContribution
Effect

IncomeTaxEffect

$600

Column8

($200)
Column9

$0
$200
($100)
Column10
Column11

TransfersEffect

$0
$100
($50)
Column12
Column13

EU21/OECD28Country
OECD28Country

(ThousandsofUS$)

Unemployment

$0
$50
$0
Column14
Column15

GrantsEffect

$75
$150
($30)
Column16
Column17

InternalRateof
Return

NetPresentValue

$0
$30
$0
Column18
Column19

$250
$500
0%
Column20
Column21

30%
60%
Column22
Column23

UnitedStates

Colum

UnitedStates

Portugal

Portugal

Hungary

Hungary

Slovenia

Slovenia

Ireland

Ireland

CzechRepublic

CzechRepublic

Austria

Austria

Poland

Poland

Belgium

Belgium

Italy

Italy

Germany

Germany

Netherlands

Netherlands

UnitedKingdom

UnitedKingdom

SlovakRepublic

SlovakRepublic

Korea

Korea

France

France

Canada

Canada

Australia

Australia

Israel

Israel

Finland

Finland

Japan

Japan

Spain

Spain

Norway

Norway

Turkey

Turkey

Sweden

Sweden

NewZealand

NewZealand

Estonia

Estonia

Denmark

Denmark
Noncumulative Values

(ThousandsofUS$)

Noncumulative Values

Noncumulative Values

Noncumulative Values

(ThousandsofUS$)

5.EqualityBetweenMenandWomen
Rawdataformenandwomenincludingtertiary/nontertiaryeducationandprivate/publicvaluesofthespecifiedindicators.InequivalentUSDconvertedusingPPPsforGDP(2008orlatestavailableyear).
Foregone
Earnings

Men
(ThousandsofUS$)

DirectCost
50

50

100

100
100

50
Belgium

Korea

GrossEarnings Netherlands
Benefits
Japan
Germany

100

50

United Kingdom
Norway
Austria
Finland

Estonia
EqualValues
Ratio=1

GrossEarnings
Benefits

Portugal

Poland

Denmark

Spain

Israel

Turkey

Sweden

Hungary

SlovakRepublic

Slovenia
France
Czech Republic

UnitedStates
Canada
Ireland

New
Zealand

Italy
Australia

IncomeTax
Effect

SocialContribution
Effect

800

250

100

60

400

250
0

400

Turkey
Belgium
Netherlands
Japan

800
Ireland

250

United States

Italy

Australia

Korea

100

Israel
Poland

Spain
Hungary
United Kingdom
Czech Republic
Finland

France

Estonia
SlovakRepublic
Austria

100

Unemployment
Effect

TertiaryEducation
NonTertiary Education

30

25
60

MentoWomenRatiofor
SelectedIndicators
Ratio based oncumulativepublic
andprivatevaluefor each
selectedindicator

NewZealand

Sweden

NetPresent
Value

GrantsEffect

InternalRateof
Return

500

50%

Women(ThousandsofUS$)

Slovenia
Canada
Denmark
Norway
Germany

Portugal

125

60

100
250

Unemployment
Effect

TransfersEffect

60

30
25

Belgium
Netherlands
Japan
Estonia
Poland
Germany
Spain
Hungary

125
Norway

0
30

Korea
Denmark
Finland
UnitedKingdom
Denmark
Austria
Canada
NewZealand
Israel

Australia
Slovenia
UnitedStates
Italy
SlovakRepublic
NetPresent Turkey
France
Ireland
Value
Czech Republic
Portugal
Sweden

30

0%
0

Belgium
Netherlands
Japan
Estonia

500
Norway

50%

Korea

InternalRateof
Return

Finland
United Kingdom
Denmark

Poland

Austria

Germany

Canada
NewZealand

Spain
Hungary
Slovenia
Italy
Turkey
France
CzechRepublic

0%

Israel

Sweden

Australia
UnitedStates
SlovakRepublic
Ireland
Portugal