COST-BENEFIT ANALYSIS OF EDUCATION IN NIGERIA

All over the world, education is recognized as a veritable tool for individual and national development. The realization of this, perhaps, led to the early introduction of formal education. Consequently, various sums of money are earmarked annually for the provision of educational services to the people by the government. The Federal Government’s capital and recurrent expenditure on education has being on the increase over the years. For instance, it rose from 26,721.3 million naira in 1998 to 31,563.8 million naira in 1999 and in 2005,it increased to 120,035.5 million naira. Besides, enrolments in the various levels of education have tremendously increased over the years. In this direction, primary school enrolment in Nigeria increased from 19,907,010 in 1999 when the UBE programme was launched to 19,158,439 and 19,384,814 in 2000 and 2001 respectively, as well as, other levels of education. The inference that emerges from the increase in expenditure on education, coupled with the increased enrolment at all levels of education is that, individuals and societies believe there are costs and benefits from acquiring education. Here lies the essence of Cost-Benefit Analysis (CBA) of Education. Consequent upon this, this paper therefore, discusses education as an investment and as consumption, the nature of cost and benefit in education, opportunity cost, criteria for CBA, such as the Net Present Value (NPV), the Internal Rate of Return (IRR) and the relevance of CBA in the developing economies with particular reference to Nigeria; due to the numerous educational projects that are currently on course yearning for the limited scarce fiscal resource