“social rate of return”

Where’s the idealism?

“The social internal rate of return refers to the costs and benefits to society of investment in education, which includes the opportunity cost of having people not participating in the production of output and the full cost of the provision of education rather than only the cost borne by the individual. The social benefit includes the increased productivity associated with the investment in education and a host of possible non-economic benefits, such as lower crime, better health, more social cohesion and more informed and effective citizens.”

Education at a Glance, OECD, Paris, 2002. http://stats.oecd.org/glossary/detail.asp?ID=5426 Accessed 15 July 2013.

“The benefits of higher learning include not only increased earnings, access to jobs, and economic growth effects, but also non-market private benefits beyond earnings to individuals and their families and external benefits to the society.

“The non-market private benefits are, for example, better health, better spousal and child health, greater longevity, child cognitive development, and increased happiness.  The value of these private benefits estimated by the income-equivalent method is substantial, and approximately equal to the earnings benefits.

“The non-market social benefits… include the contribution of higher education graduates to the improved operation of democratic, civic, and charitable institutions, to human rights, to political stability, to lower crime rates, to social capital and social cohesion, to the generation and adaptation of new ideas, and so forth. They also are substantial; estimated to be another 40% beyond the private earnings benefits.” From the July 1, 2009, cover article of Rorotoko. http://rorotoko.com/interview/20090701_mcmahon_
walter_higher_learning_private_social_ benefits_education
Accessed 15 July 2013.

“new ideas, and so forth.” So that’s what I’m doing as a professional educator. Higher education is about rates of return on investment–economic, social, environmental. Non-economic benefits correlate with higher earnings.

Why this rant?

The  LSU system president visited our campus today; his message was serious but not too discouraging. As expected, he discussed political economics–which is dire enough for almost every one but especially for public education and other social services. More briefly, he gave us some hope that our hybrid two-year rural campus may remain an integral part of the Tiger mission, especially as an “access point” for “the costliest students” (there’s the economic metaphor again).  Yet although LSU Eunice’s student body has the highest percentage of Pell grant recipients, it also has the highest number of TOPS scholarship students in the state. We’re not just the low end of the tiger totem pole.

Go Bengals–tigers now and forever!

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