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Estimating Private Rate Of Retun On Higher Education In Pakistan

Author

Listed:
  • Malik Fahim BASHIR

    () (Department of Management Sciences, COMSATS Institute of Information Technology Abbottabad, Pakistan)

  • Muhammad Mazhar IQBAL

    () (Department of Economics, Quaid-i-Azam University, Islamabad, Pakistan)

  • Khalid ZAMAN

    () (Department of Management Sciences, COMSATS Institute of Information Technology, Abbottabad, Pakistan)

Abstract

The current study focuses primarily on estimating private rate of return for two successive degrees of higher education in Pakistan namely M.Phil and PhD. Sensitivity analysis on calculations of the average private rate of return to university education is undertaken. This involves checking how estimates of the rate of return vary with key assumptions used to calculate the rate of return. Further, to estimate internal rate of returns, explicit & implicit costs and earnings on BPS-2005 scale to which a degree holder is eligible to apply. Estimates of the rate of return to a university degree would provide one measure of the net monetary benefits from higher education. Result reveals that private rate of return is extremely low for M.Phil and PhD degrees that can explain dismay situation of higher education in the country. To boost higher education, private rate of return must increase that can be achieved effectively either by raising pay scales, or by giving interest-free scholarships or by increasing retirement age.

Suggested Citation

  • Malik Fahim BASHIR & Muhammad Mazhar IQBAL & Khalid ZAMAN, 2011. "Estimating Private Rate Of Retun On Higher Education In Pakistan," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 7, pages 179-197, May.
  • Handle: RePEc:aic:revebs:y:2011:i:7:bashirm
    as

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    More about this item

    Keywords

    Education; Human Capital; Economic Growth; Cost Benefit Analysis; Public Sector; Pakistan;

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions

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