Education Is a Good Investment or Consumption

2468 Words Nov 23rd, 2012 10 Pages
INTRODUCTION Education can view as consumption and investment. A product or services is considered to belong to the consumption category when it gives satisfaction or utility in a single period only while, it is considered pure investment goods or services when it is expected to give satisfaction in the future periods only.
Education is regarded as the most important determinant of a person’s economic and social success. In economy, terms of education is an economic good because anything that satisfies a human wants is considered a good. Consumption can be determined as simply paying the cost for a good or services and receiving all of the benefits for that good or services immediately. Education as consumption is education as a
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The higher level of education was received, then the higher position in the society. This is because nowadays society regards that education as an important asset in the development of human capital, which is able to produce individual to be knowledgeable and will have a highly skilled. Therefore, individuals with higher education will be able to deal with the amount of individuals who had a low education in the labor market even though they are fresh to the job market. Education people are seen as very important people in the effort to develop organization and they always good to the employer compare to people had a lower education level. This situation is an example for return on investment in education.
Investment in education will give advantage to individuals in terms to get higher and unlimited income level. The higher of education the higher income can be earned. In fact education will form an individual with knowledge and skills to improve themselves and in order to develop the state. With a variety of skills and knowledge that obtained from education, individuals will be able to get a job with higher offer salary or they can build own careers. Thus, who investing more in education to achieve a high level of education will be able to have a better life style with high household income, in addition education will give a lot of opportunities in terms of good job. This stated that education will bring positive returns in the long run to the individual