COST-BENEFIT ANALYSIS IN EDUCATION. RECENT DEVELOPMENTS AND FURTHER CHALLENGES

This paper focuses on the particular aspects of cost-benefit analysis in education, starting from the empirical reviews on the returns to investment in education. In time and across different countries, economists have attempted to estimate the benefits of education at an individual level (private benefits) and have extented returns to the overall society (social benefits). Although many studies have highlighted the benefits of education in the labor market, there are approaches of non-economic benefits, such as greater social cohesion, lower crime and better health, arising from better-educated people. The funding sources of education have been grouped into two broad categories: public and private. We have presented an overview of the public and private costs in the recent years in Romania, in comparison with those of the European countries. The relative importance of the funds allocated to education in Romania has been considered on the basis of some indicators of internal efficiency and performance or students outcomes. There are some limitations concerning the implementation of cost-benefit analysis in education, whereas becomes difficult a rigorous estimation of the social benefits, as a result of some differences between women and men, on the level of schooling and also depending on the country. Despite these limitations, we support the idea that there is a growing need to use this method in order to increase the efficiency in allocation and use of resources in education.