What are the opportunity costs of being a student in higher education?
- The opportunity cost of being a student in higher education comprises alternatives that a student could have pursued instead of attending school. These include having a family, working, vacations, pursuing one’s passion and dreams, running a business, and loss of valuable time (Goastellec and Picard 54). The opportunity cost of higher education is the sum of all the alternative activities a student could pursue instead of spending time in college attending classes and doing other activities.
- The opportunity cost of spending an evening revising for an economics exam is foregoing a part-time job or sacrificing a night out with friends. A student would need to know what is more important to them in order to make the best decision with regard to the best use of their time and energy. In addition, they should know what their core values are because the best decisions are based on an individual’s core values. The student should decide whether pursuing the alternatives is more beneficial than revising for the economics exam. The option that provides more value becomes the best course of action to pursue (McEachern 46).
Costs of higher education
The costs of food are not included because inspire of the choice made, it is a necessary expense that is incurred. If an individual decides to join college, they will spend money on food. On the other hand, if they choose not to g to college, they will still spend money on food. Therefore, the cost of food cannot be considered as an opportunity cost. Similarly, clothing cannot be included in the equation because both choices will entail spending money on clothing. Clothing and food costs are not sacrifices that an individual makes when they decide to either attend or not attend college (McMahon 63).
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The benefits of higher education include:
- Preparation for a career of choice.
- Opportunity to improve the standards of living.
- Possessions of skills and knowledge necessary to pursue desired careers and professions, as well as navigate life. In addition to academic knowledge, students gain social knowledge and skills that help them in creating collaborative relationships outside of school (McMahon 71).
- Economic empowerment in the form of income, wages, and salaries. Research has shown that an individual’s income is directly proportional to their level of education.
- Enhanced decision-making capabilities. Graduates gain knowledge and experience that allows them to make healthy decisions that benefit them and society.
- High standards of living with regard to economic and physical well being (Vedder par. 4).
- Personal development: enhanced critical thinking skills, better communication skills, a greater sense of discipline, the realization of passions, and a sense of accomplishment (McMahon 76).
The opportunity cost to the individual and society is dissimilar because of the varied benefits the individual and society reap from higher education. For example, the benefits that an individual gets include personal development, a career of choice, an income, and acquisition of specific knowledge and skills that are important in life (Schierenbeck 93). On the other hand, the benefits of higher education to society include lower rates of crime, social cohesion, political stability, social capital, and enhanced social mobility. Societal economic benefits include increased tax revenues, labour market flexibility, and increased innovation (Toutkoushian and Paulsen 63). As a result, individuals enjoy higher earnings, low rates of unemployment, higher productivity, and greater life satisfaction.
Goastellec, Gaele, and France Picard. Higher Education in Societies: A Multi Scale Perspective. New York: Springer, 2014. Print.
McEachern, William. Economics: A Contemporary Introduction. New York: Cengage Learning, 2008. Print.
McMahon, Walter. Higher Learning, Greater Good: The Private and Social Benefits of Higher Education. New York: JHU Press, 2010. Print.
Schierenbeck, Christian. Fixing Higher Education: A Business Manager’s Take on How to Boost Productivity in Higher Education. New York: Springer Science & Business, 2012. Print.
Toutkoushian, Robert, and Michael Paulsen. Economics of Higher Education: Background, Concepts and Applications. New York: Springer, 2016. Print.
Vedder, Richard. The Opportunity Cost of Higher Education. 2015.