HOW TO MEASURE THE LEVEL OF RETURN ON EDUCATION WITH A SOCIO-ECONOMIC APPROACH? – International Journal of Social Sciences and Management Review

HOW TO MEASURE THE LEVEL OF RETURN ON EDUCATION WITH A SOCIO-ECONOMIC APPROACH?

Authors: Putu Ayu Pramitha Purwanti, I Gusti Ayu Manuati Dewi & Ni Nyoman Reni Suasih

ABSTRACT

Education as an investment in human capital has a positive relationship with economic growth.education is considered as an investment, so it is necessary to ask what the benefits of the investment are compared to other alternatives. So far, the rate of return on education has been approached more from an economic aspect, even though the rate of return can also be measured through social aspects. Therefore, this paper compiles a model to measure the rate of return on education not only from an economic aspect, but also a social aspect. The methodology used is to conduct a literature review to formulate the model. Testing the rate of return on education with an economic approach can use the Mincer model (1974) with the target variable being income. While the predictor variables are education level, potential work experience and gender. While the measurement of the average rate of return on investment for each level of education is calculated by referring to the method developed by Deolalikar (1993) using the education coefficient and length of school. While the rate of return on education in the social aspect is measured from the level of health, so the target is health insurance ownership. The predictor variables also use education level, potential work experience and gender. As a follow-up, this measurement technique needs to be tested using real data.

Keywords: rate of return on education, economic aspects, social aspects

REFERENCES

Barro, R. J., & Lee, J. W. (2010). A new data set of educational attainment in the world, 1950-2010. NBER Working Paper, 15902. National Bureau of Economic Research.
Becker, G. S. (1993). Human capital. Chicago: University of Chicago Press
Card, D. (1999). The Causal Effect of Education on Earnings. In O. Ashenfelter & D. Card, Handbook of Labor Economics, Volume 3 (pp. 1801-1863), California: Elsevier Science B.V
Deolalikar, Anil. (1993). Gender Differences in the Returns to Schooling and in School Enrollment Rates in Indonesia. Journal of Human Resources. 28 (4), 899-932.
Diskstra, A., and de la Motte P.I. (2014). Social Outcomes of Educatios. The Assessment of Social Outcoomes and School Improvement through School Inspections. Amsterdam University Press
Duflo, E. (2001). Schooling and labor market consequences of school construction in Indonesia: Evidence from an unusual policy experiment. American Economic Review, 91(4), 795-813.
Dumauli, M. T. (2015). Estimate of the private return on education in Indonesia: Evidence from sibling data. International Journal of Educational Development, 42, 14-2
Grossman, M. (1972). On the Concept of Health and the Demand for Health. The Journal of Political Economy, 80(2), 223-255.
Hartog, C.d. & Kuo, J. (2006). Taxonomy and biogeography of seagrasses. In Seagrasses. Springer, Dordtrecht.
Heckman, J.J., Locher, L.J., & Todd, P.E. (2008). Earnings Function and Rates of Return. Journal of Human Capital, 2(1), 1-31.
Hendajany, N., Widodo, T., & Sulistyaningrum, E. (2016). Perkembangan tingkat pengembalian investasi pendidikan antar-provinsi: Indonesia Family Life Survey 1993–2014. Jurnal Ekonomi dan Pembangunan Indonesia, 17(1), 44-57.
Huang, C.Y., Hsu, M.C., Hsu, S.P., Cheng, P.C., Lin, S.F., Chuang, C.H. (2010). Mediating roles of social support on poststroke depression and quality of life in patients with ischemic stroke. J Clin Nurs, Oct, 19, 19-20. DOI: 10.1111/j.1365-2702.2010.03327.x
Kim, S dan Mohtadi, H. (1992). Education, Job Signaling, and Dual Labor Markets in Developing Coutries. Diakses dari: https://www.ageconsearch.umn.edu, pada 11 Agustus 2015
Kitchenham, B. (2004). Procedures for Performing Systematic Reviews. Keele University, Keele, 33.
Komaruddin (1991). Analisis Manajemen Produksi. Jakarta: Bumi Aksara.
Kruger, A.B. & Lindahl, M. (2001). Education for Growth: Why and For Whom? Journal of Economic Literature, 39(4), 1101-1136. DOI: 10.2139/ssrn/223589
Megasari, D.N. & Purnastuti, L. (2016). Disparitas Gender Dalam Tingkat Pengembalian Investasi Pendidikan di Jawa Barat. Jurnal economia, 12(1), 23-31.
Mincer, J. (1962). On-the-job training: Costs, returns, and some implications. Journal of Political Economy, 70(5, Part 2), 50-79
Nursalam. (2016). Metodologi Penelitian Ilmu Keperawatan. Jakarta: Selemba.
Perry, A. & Hammond, N. (2002). Systematic Review: The. Experience of a PhD Student. Psychology Learning and Teaching, 2(1), 32–35.
Psacharopoulos, G. (1981). Returns to education: an updated international comparison. Comparative Education, 17(3), 321-341.
Psacharopoulos, G. (1995). The profitability of investment in education: concepts and methods. Human Capital Development and Operations Policy (HCO) Working Papers, 63. Washington, DC: World Bank
Purnastuti, L., Miller, P. W., & Salim, R. (2013). Declining rates of return to education: evidence for Indonesia. Bulletin of Indonesian Economic Studies, 49(2), 213-236
Putnam, R.D. (2000) Bowling Alone: The Collapse and Revival of American Community. Simon and Schuster, New York. http://dx.doi.org/10.1145/358916.361990Putnam 2000
Putnam, R.D. (1993) Making Democracy Work. Making Democracy Work: Civic Traditions in Modern Italy. Princeton University Press, Princeton, USA.
Romanello, M. (2016). The private and social return to education considering the characteristics of society. Revista Espacios, 38(15), 1-9.
Smith, J. A. (Ed.). (2003). Qualitative psychology: A practical guide to research methods. Sage Publications, Inc.
Sunaryo, Agus (2017) Pengembangan bahan ajar pendidikan dan pelatihan penjenjangan perencanaan pada Kementerian Aama / Agus Sunaryo. Doctoral thesis, Universitas Negeri Malang.