This document discusses cost benefit analysis of primary and secondary education. It defines cost benefit analysis and outlines the different types of costs of education, including individual/private costs and institutional/public costs. Individual costs are direct costs like tuition as well as indirect costs. Institutional costs include variable/fixed, recurring/non-recurring, and current/capital costs. The document also explains how to perform a cost benefit analysis by assigning monetary values to costs and benefits and comparing them. Advantages are that it can be used for new and old projects and encourages evaluating social benefits. Disadvantages are that not all costs and benefits may be known and it does not specify who bears population control costs.
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5. Cost Benefit Analysis
"A practical way of assessing the desirability of projects,
where it is important to take a long view (in the sense of
looking at repercussions in the further, as well as in the
nearer, future) and a wide view (in the sense of allowing
for side-effects of many kinds on many persons, industries,
regions, etc.), i.e. it implies the enumeration and
evaluation of all the relevant costs and benefits."
(Press end Turvey, 1965)
6. Classification of cost of Education
Costs can be classified into two types;
Individual or private costs.
Institutional or public social costs.
7. Individual or Private Cost
Individual costs or private costs of education are those costs of
education incurred by a learner or by his/her parents/guardians or by
the family as a whole. Individual cost are of two kinds;
i. Direct.
i. Indirect
8. Institutional Cost of Education
Cost incurred at the institutional level (government, private or mixed)
are called institutional cost or public costs of education. Public costs
are those that include financing by the government on the basis of
taxes, loans, and other public revenues. The institutional costs of
education are, generally, analyzed using the following variables.
• Variable and fixed costs of education.
• Recurring and non-recurring costs of education.
• Current and capital costs of education.
9. Types of Costs:
1. Total Cost
2. Total Fixed costs and total variable costs.
3. Current costs and capital costs.
4. Opportunity costs.
5. Social or Total cost of education.
6. Unit costs of education.
10. Cost Benefit and Cost effectiveness Analysis
Cost-benefit analysis and cost effectiveness analysis can
help us in evaluating the alternative uses of resources. The
estimation of a unit cost is necessary, if one has to make a
cost-benefit or cost-effectiveness analysis. In a cost-benefit
analysis, the output is measured in monetary terms, and in
cost-effectiveness analysis, the output is addressed in terms
of the level of achievement of the objectives. Cost benefit
analysis is also known as “rate of return” analysis.
11. In order to perform cost benefit analysis a exercise which
is used to monetize the outcomes as follows;
Benefit for Entry
Benefit for Completion
Benefit for learning
12. Steps to do a cost-benefit analysis
Step One: Brainstorm Costs and Benefits.
Step Two: Assign a Monetary Value to the Costs.
Step Three: Assign a Monetary Value to the Benefits.
Step Four: Compare Costs and Benefits.
13. Advantages of Cost Benefit Analysis
1. The Cost Benefit analysis may be applicable for both
the new as well as old projects.
2. It is based of accepted social principle that is on
individual preference.
3. This method encourages development for new
techniques for the evaluation of social benefits.
14. Disadvantages of Cost Benefit Analysis
i. The government is not completely aware of all the
cost and benefits associated with the program.
ii. This approach does not clearly states that who should
bear the population control cost.
15. Conclusion:
It is concluded that it is a decision making process that
forces the decision maker to compare all direct and
indirect positive and negative effects of the proposed
decision on an objective basis. This process improves the
efficiency of resource utilization.
