Define the following terms as used in economics of education Introduction Education economists analyze both what determines or creates

education and what impact education has on individuals and the societies and economies in which they live. Historically at the World Bank a great deal of emphasis has been placed on determining outcomes to educational investment and the creation of human capital. The primary mission of the economics of education group is to identify opportunities for improved efficiency, equity, and quality of education and promote effective education reform processes; to help improve, among both World Bank staff and clients, knowledge of what drives education outcomes and results; to better understanding how to strengthen the links of education systems with the labor market; and to build and support a network of education economists and build bridges to all those who are interested in their work. Education economics or the economics of education is the study of economic issues relating to education, including the demand for education and the financing and provision of education. From early works on the relationship between schooling and labor market outcomes for individuals, the field of the economics of education has grown rapidly to cover virtually all areas with linkages to education. Capital Investment Consumption

In your view is education an investment or a consumption Education can be viewed as consumption, as investment and as consumption and investment are complementary. Education as consumption is education as a fundamental human right. Or is one of the democratic rights of every citizen. So until a certain level of procurement should be done by the government. Therefore, in many countries basic education (primary and secondary school) were used as compulsory education. As a consequence of education at this level of education not only as a right, but also as an obligation for every citizen at a particular age level (in Indonesia between 6 and 15 years). In terms of the nature of needs, procurement of education at this level is a public good. Then views of motivation, then education as consumption is motivated by a desire to satisfy the need for personal development, social needs, the need for knowledge and understanding. Furthermore, the orientation time is now. Demand for education is influenced by the size of disposable income. Education as an investment objective to obtain net income or rate of return is greater in the future. Education costs in this type of education is viewed as the amount of money bought to acquire or invest in a number of human capital (human capital) that can enlarge the economic capacity in the future. Education as an investment based on the assumption that man is a form of capital (capital) as other forms of capital that are critical to the growth of productivity of a nation. Through his investment someone can expand alternative to other activities so as to improve the welfare of his life in the future. Education as consumption and investment are complementary. Education after compulsory education has the aim not only to acquire knowledge, understanding, personality development, and the satisfaction of social needs (status and prestige) as well as to obtain better jobs, so it can earn net income for life is higher in the foreseeable come. In accordance with the above description, the amount of education acquired by a person will have high impact on low income that he obtained, though not fully guarantee. But the trend is quite large.
2

Economists have defined education as both an investment and consumption good. It is consumption good because a lot of the students especially those that go into colleges and graduate schools could be said to enjoy the lectures and the homework including the readings, etc notwithstanding the final exams. Education is also an investment good because at its very nature it comes with a lot of uncertainty and risk just like any other financial investment. Moreover, it involves foregoing current consumption to be able to increase consumption sometime in the future.

REFRENCES Daniele Checchi, 2006. The Economics of Education: Nyumbani Human Capital, Family Background and Inequality, Cambridge. William A. Fischel, 2008. "Educational finance," The New Palgrave Dictionary of Economics, 2nd Edition

Discuss how university students finance their education in Kenya today University education forms the apex of Kenyas formal education and training. In addition to preparing high-level manpower for national development, university education is charged with undertaking research, development and dissemination of knowledge. In Kenya, there are 23 universities - 17 private universities and 6 public universities (Government of Kenya, 2004). Unlike public universities, private universities have increased significantly from 8 in 1999 to 17 in 2003, therefore contributing significantly towards enhancing access to tertiary education in Kenya. Higher education is highly subsidized throughout the world, especially in less developed countries. Thus the general taxpayer is contributing to education-costing several times the national average income per capita-for a few individuals who are quite often drawn from the upper economic classes. The initiation of full cost pricing combined with loans to students is one way to handle this inequitable situation. Two types of loans and the respective problems, advantages, and disadvantages of each are discussed: traditional loans (fixed term of 5-15 years), and loans which are repaid through a surtax on income. The effects of self-finance of education on student attitudes and learning as well as on government revenue are brought out. Finally, simulated data for various loan programs for higher education in Kenya are presented and discussed. The Higher Education Loans Board is state corporations whose mandate is to source funds and provide loans, scholarships and bursaries to Kenyans studying in recognized institutions of higher learning. The Board disburses loans to any Kenyan undergraduate students enrolled in government or selfsponsored programmes in Kenyan Universities and Universities in other member states of East Africa Community recognized by the Commission for Higher Education. Scholarships Students who are offered admission to Iowa State will be considered automatically for many scholarships. Because some scholarships have early deadlines, it is important to apply for admission as far in advance as possible the fall prior to entry for summer and fall terms.
5

Application for some scholarships requires that students submit additional materials, such as essays, recommendations, separate applications, and/or the completed Free Application for Federal Student Aid (FAFSA). Check out the scholarships for undergraduate students, departmental scholarships, and other opportunities on the scholarships page. Student employment Many students finance their education through part-time jobs. In fact, research has shown that students who work up to twelve hours per week have higher grade point averages than students who do not work. Loans Your student loan is unlike any other loan you will ever have in your life, and although you will be charged a real rate of interest, it will be tapered to increase gradually as you earn more. Furthermore, repayments dont start until after youve started earning, and theyre based on a proportion of your income, not on the size of the debt, but we will deal with that bit later... Finally, the government has now agreed to write off any debts still unpaid 30 years after the completion of your course. There are different types of loan: Tuition Fee Loan - The government will lend any eligible students the money to pay tuition fees, which you wont have to pay back until you are earning at least 21,000. This is regardless of your household income. Maintenance Loan - You can apply for a means-tested annual Maintenance Loan and the amount you are entitled to will depend on your household income. The amount you receive also depends on whether you choose to live at home whilst studying or, if you live in London, you are entitled to a little more due to higher living costs. At the time of going to print the government had not finalized the full details of loan rates, although there will be some money for every student, irrespective of their family income. Check www.direct.gov.uk regularly for updates. Part-Time Student Loan - For the first time, part-time students studying at least 25% of their time, will be entitled to a loan and will no longer be required to pay their fees upfront.
6

Grants Government grants will be available for students from low income households, and unlike loans, means-tested grants (which means that the amount you get depends on your household income) do not need to be repaid. Two family income bands have been suggested; up to 25,000 entitles a student to the full grant of up to 3,250 per year, and 25,0000-42,000 which will mean entitlement to a partial grant. Bursaries Universities and higher education colleges offer additional, non-repayable financial help in the form of bursaries which are allocated according to the university and course you choose and your household income. Under the new rules those universities that choose to charge over 6,000 will also have to demonstrate that they are supporting applicants from lower income households, so ring up the institutions you are thinking of applying to and find out what support is available and how to apply because each university has their own rules about entitlements to bursaries and their own procedures to follow. Scholarships Universities sometimes offer scholarships to high achieving students. Youll get a direct payment from your college or university- how and when this is paid is decided by the institution. If you are looking to apply for scholarships find out what is on offer from the institutions themselves by calling them they will often have set up their own schemes with their own individual criteria for application. Part Time Job Its a good idea to get yourself a part-time job while at university. Its a great way to make friends, get some work experience and earn a bit of cash. A word of warning though, if you find yourself working so much that it is adversely affecting your studies then cut your hours back. There is absolutely no point earning money to pay for a degree you cant study because you are working

too hard to pay for it. Dont miss lectures and tutorials and make your employer aware from the start that you are a student. Government-sponsored students (JAB)