Why People Need To Be Educated Essay - 275 Words

Why People Need To Be Educated (Essay Sample) Content: Name:Unit:Lecturer:Date Due:Why People Need To Be EducatedIntroductionEconomists have customarily considered education as an investment in human capital, which has a direct impact on both the educated individuals and the society at large. Generally speaking, people with better education have an upper hand in politics, social life and economics than those with basic schooling. However, it would be biased to assume that all the observable differences among people are brought by education. Many factors contribute to the difference in economic status and this includes family backgrounds and innate ability. In actual sense, these factors interact with the formal education environment and jointly help to develop preferences that determine peopleà ¢Ã¢â€š ¬s economic behavior. Even so, still there is evidence pointing out that, other factors neutral, better educated individuals normally have better jobs and higher income than those with average education. Further, they enjoy other benefits attributed to their schooling experience. Furthermore, it is factual that communities and countries with higher literacy levels have better living conditions than those with a less educated population. Therefore, this paper discusses the benefits of education as an attempt to substantiate the fact most of the observable difference in welfare are as a result of differences in education levels. To this end, the paper will have explored the reasons behind the need to be educated.The Impact of EducationFrom an economic point of view, the time and money invested in educating an individual is in itself an investment, and like any other form of investment and under ideal conditions, the education must pay returns. Typically, these returns have a positive net impact on the educated fellow and the society around him or her as a whole. Additionally, the returns can be seen as the ability of the educated individual to satisfy human needs. As of consequence, the benefits of educ ation can be defined as the impacts of schooling that produces the utility function. Given that the educated individuals live in communities, it follows that the benefits of education should be analyzed in terms of individual and society utility. Further, the benefits of education may be contained in terms of better production capabilities and less need to incur losses. Free primary education or subsidies on either tertiary or secondary education are examples of benefits that reduce the tax-payers educational costs. From a human capital perspective, numerous researches have been conducted to determine the relationship between schooling and monetary returns to both the leaner and the society at large CITATION OEC13 \p 1 \m Psa04 \p 111 \m van081 \p 1 \l 1033 (OECD 1; Psacharopoulos and Patrinos 111; van der Berg 1). The section that follows outlines the benefits of education by reviewing several empirical researches, and then discusses their findings with respect to the reasons beh ind schooling.Education reduces poverty in both developed and developing countriesVan der Berg (1) contends that when discussing the concept of education as a remedy of poverty in both developed and developing countries contexts, the debate should be broadened beyond the focus on an individualà ¢Ã¢â€š ¬s lack of financial resources to meet his or her basic needs: food, clothing and shelter. This is in view of the fact that the relationship between poverty and education is multifaceted. Poor households are often unable to access adequate education. Consequentially, they are constrained economically and socially. For example, a student from a poor family may not access tertiary education, thereby limiting his or her employment options. Unless someone breaks out and supports other family members, the poverty cycle is likely to continue within such contexts. Remarkably, it is only through basic education and technical skills that even peasant farmers get to understand how to climb thei r way out of either absolute or relative poverty CITATION Pet081 \p 5 \l 1033 (Orazem, Glewwe and Patrinos 5). Absolute poverty is the lack of monetary resources crucial to meet basic human needs CITATION van081 \p 11 \l 1033 (van der Berg 11). Conversely, relative poverty is determined by the society within which a person lives. For example, under the same economic resources, a family which may not be perceived as poor in Washington may be highlighted as poor in London. As of this writing London was the most expensive city CITATION The143 \p "par. 1" \l 1033 (The Telegraph par. 1). Inadequate financial resources may limit schooling among absolute poor people in developing countries. In contrast, the relatively poor people in developed countries often feel alienated in the schooling environment and such perceived exclusion hampers their ability to gain from education or to translate the benefits of being educated into meaningful employment.Better schooled people are economical ly productive, thus earn higher incomes that those that less educated CITATION van081 \p 3 \l 1033 (van der Berg 3). The higher income is also linked to the fact that better educated people have a better chance of being employed due to their rich skill set and experience. As economies continue to move to the global village and digital space, the probability of being employed rises with the levels of education. In the same context, earnings become are lucrative for people with higher levels of education. As of consequence, households with better education are less likely to be poor irrespective of their location across the world. Van der Berg (3) notes that middle-income countries are more likely to reap the benefits of educated labor than developing countries subject to the fact that the former often have developed markets for educated labor. In Chile, for example, between 25% and 30% of family income differences can be substantiated by the level of education of the family heads C ITATION van081 \p 3 \l 1033 (van der Berg 3).Education Enhances Economic GrowthEducation fuels economic growth in both poor and developed countries CITATION van081 \p 10 \l 1033 (van der Berg 10). Noteworthy, the upshot of education in economic development relies on the quantity and quality of education. Understandably, it is illogical to support a rapid expansion of education within a company while compromising quality. Arguably, both quality education and quantity of educational output stimulates economic growth. It is quality of education that translates to strategic leaders and managers. Quality and quantity education compliment the growing demand for highly skilled workers in the globalised world. As noted above, individual with better education earn more. In financially literate settings, high incomes translate to considerably high saving and investment patterns. For example, China and India has consistently strived to improve education and this has been mirrored by an inc rease in their economic growth rate CITATION van081 \p 6 \l 1033 (van der Berg 6). Such growth can mitigate poverty dramatically.Educated labor force competes at the international level for jobs. Lack of skilled labor derived from education is sometimes a constraint of development. For example, lack doctors, engineers, information technology experts and scientist limit growth of developing countries because they have to rely on developed countries for infrastructural development. In the context of labor market, the more educate people are likely to earn higher wages than the less educated folks CITATION Pet081 \p 4 \l 1033 (Orazem, Glewwe and Patrinos 4). It is worth noting that higher wages is also linked to higher productivity, which is time and again associated with strategic and knowledgeable human capital. Additionally, productivity indicates the ability of employers to recruit and retain a human resource that is well educated. Perhaps, this explains why most 500 Fortune co mpanies continue to train their human resource departments on issues pertaining to production and investments.Education influences income levels, which in turn influences the saving and investment patterns on an individual, group, community or country. As a matter of fact, education stimulates financial independence and transforms the lives of people ranging from investors, consumers and average citizens. In the view of the fact that there is a constructive relationship between education and income, it follows that financially literacy plays a critical role in the level of investment and Gross Domestic Product. That is to say, education, financial literacy to be precise, stimulates progressive investment in human capital and businesses at both individual and national levels CITATION Pet081 \p 5 \l 1033 (Orazem, Glewwe and Patrinos 5). Such investments fuel economic growth relative to the GDP. Eventually, local investors and venture capitalist benefit from educated labor and financ ial stability. While some studies provide a strong case for supporting primary education due to quantified economic benefits of being educated CITATION van081 \p 3 \l 1033 (van der Berg 3), new evidence indicates that investment in secondary and tertiary education may harvest higher benefits in most countries CITATION Psa04 \p 115 \l 1033 (Psacharopoulos and Patrinos 115). Globalization has increased the demand for highly skilled workers with diversified backgrounds. To meet this demand, individuals, education institutions and governments must adjust their educational output accordingly. Logically, it also implies that individuals must continue to work hard at school in all levels so as to remain relevant in the ever dynamic labor market.Education Improves Living Standards or Social WelfarePeople should be educated because schooling brings significant benefits to individuals and the society, not only through remunerative economic activities, but also thr...