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The Timing of Investments in Human Capital: a Case in Education

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  • A.G. Holtmann

    (Department of Economics State University of New York at Binghamton)

Abstract

The timing of investments in human capital is important. Since the net present value of an investment in human capital may change over time, the decision to invest should be made so as to maximize the net present value of the investment. After sketching the proper decision rule in cases where timing is important in an investment, the net present value of completing eighth grade rises for nonwhites in the South. This finding suggests that it might sometimes be wise to delay investments in education until the students are older.

Suggested Citation

  • A.G. Holtmann, 1973. "The Timing of Investments in Human Capital: a Case in Education," Public Finance Review, , vol. 1(3), pages 300-306, July.
    • Handle: RePEc:sae:pubfin:v:1:y:1973:i:3:p:300-306
    DOI: 10.1177/109114217300100303
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    References listed on IDEAS

    as
    1. Giora Hanoch, 1967. "An Economic Analysis of Earnings and Schooling," Journal of Human Resources, University of Wisconsin Press, vol. 2(3), pages 310-329.
    2. A. M. Nalla Gounden, 1967. "Investment in Education in India," Journal of Human Resources, University of Wisconsin Press, vol. 2(3), pages 347-358.
    3. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352-352.
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