Anna Vignoles - Why we should invest in education and how to measure the return

We think of education as an investment because when you invest in more education, you gain skills that are valuable in the labour market.

About Anna Vignoles 

"Formerly Professor of Education at the University of Cambridge, I am the Director of the Leverhulme Trust and an economist of education.

I’m an economist of education, which means I apply economic principles to the study of education. I do lots of work on trying to understand the effectiveness of different education systems, of understanding the causes of inequality in our education systems, and I try to come up with practical solutions to how we can narrow these inequalities."

Key Points

• We think of education as an investment because when you invest in more education, you gain skills that are valuable in the labour market.
• The benefits of investing in education from a society perspective are greater than the pure returns that an individual gets, and that's why we must have both compulsory and state-funded education.
• Many factors impact the efficiency of an education system, such as family background or the quality of the teaching in a specific school.

We think of education as an investment because when you invest in more education, you gain skills that are valuable in the labour market. It makes you more productive in your work. Consequently, you earn more. We can think of it as investing in yourself, in your own human capital. It's important to note that economists don't think that people get an education just to make themselves more skilled or just because they want to get a better job. People get an education for a variety of reasons, and going through education can be very enjoyable. However, the economic aspect is that it's an investment that will give you a return, just as though you were investing in another form of capital.