Hacia un modelo de análisis argumentativo del proceso judicial

In the economics of education, education is considered to enable social changes and empowering people. However, questions remains as to whether the benefits of education are absolute or positional. At the macro level education is known to boost economic growth but at micro-level the relationship is not as simple as that; benefits for a particular person depend on what other individuals in the society are doing and on other macro-level factors such as unemployment, labour market institutions and the industrial composition of the economy.

Education plays an important role for any individual, it enhances skill, knowledge and increases the competence of the labour force, which increases productivity and efficiency of the production process. Ultimately it significantly contributes to the nations' economy. There are also many non-monetary benefits of education, such as improved health, reduced child infant mortality rates and lower crime rate all of which improve the quality of life of citizens (Lochner, 2011).

The private non-market benefits beyond earnings include contributions to better health, increased longevity, better child cognitive development, and happiness all aspects of the quality of life and of economic development. Similarly social non-market benefits beyond earning include the estimated value of their contributions to improvements in civic institutions and governments, lower crime rates, increased social cohesion, and their generation and adaptation of new ideas. (McMohan and Oketch, 2010).

55

Human Capital Theorists contend that for any economic growth and development to occur two requirements are necessary i.e. improvement and more efficient use of technology (because higher technology use results in greater production) and the utilisation of human resources in the employment of technology (Lucas,1988). Skills and competencies are imparted by means of formal education and as a result, individuals will become more efficient and effective producing better outcomes (Schultz,1963). Therefore, the HCT postulates that an investment in education is an investment in the productivity of the population, which will result in the growth and development of the nation's economy (Becker,1965).

HCT was put forward and well accepted during the 1960s and 1970s; the goal of investment in education was economic development. The basic concept of HCT is that people spend money on themselves or their families in various ways, not for the sake of present employment but for future life-time returns. Human capital investment can include the acquisition of an additional level of education or training (pre-service training/in-service training) to enhance and enrich skills and competencies.

In other words, HCT recognizes that all labour inputs used in the production process do not necessarily make an equal contribution. Every individual has their own abilities, skills, experiences and competencies to perform the given task and as a result, they produce different levels of outcomes. The quality of employees can be improved by investing in them and as a result they produce higher levels of outcome.

It is expected that employers will pay different wages or salaries to employees based on their ability and the contribution they make in the production process. For instance, some workers will be paid substantially higher wages than others, perhaps because they have a higher level of education including exceptional skills and competencies and these workers will be most important and very useful to companies.

56

Adam Smith (1776) made important points on this topic, as he stated that, 'When any expensive machine is erected, the extraordinary work to be performed by it before it is worn out, it must be expected, will replace the capital laid out upon it, with at least the ordinary profits. A man educated at the expense of much labour and time to any of those employments which require extraordinary dexterity and skill, may be compared to one of those expensive machines'.

HTC has been explored by Schultz (1961) and clearly explained and developed in detail by Becker (1964). During the early 1960's the economist Theodore Schultz applied the concept and theory of Human Capital to reflect the value of human capacities in US economic production through what he also referred to later as the residual which could not be accounted for by traditional input factors.

HC is like any other form of capital investment. It can be invested in through education and training which will enhance and enrich employees’ essential skills, knowledge and competencies and lead to an increase in productivity. As a result, a country can use its scarce resources effectively and efficiently to achieve its estimated goals and targets.

Becker (1964) suggests that education and training raise the productivity of workers by imparting useful knowledge and skills. Schultz (1975) suggests that education enhances an individuals' ability to successfully deal with disequilibria in changing economic conditions. Such ability includes that of perceiving a given disequilibrium analyzing information, and reallocating resources. Later Mincer (1974) provided an explanation that linked investment in training with workers’ wages. During this time, economists began making tangible connections between education and its impact on the ability of humans to earn higher wages.

Furthermore (Becker, 1993) suggests that, in the past, economic development was largely dependent on tangible physical assets such as land, factories and equipment, where labour was one element in the production process. However, the modern economic paradigm has shifted towards nations' needs make more investment in education and health, since they are the key to improving human capital which ultimately increases the economic output of the nation.

57

Over the last three decades or so, more than a hundred studies have been carried out to estimate rates of return in relation to education. Most of these studies have shown that formal schooling is a crucial factor in explaining variations of salary and wages in developed countries (Cohn and Addison, 1998).

The rate of poverty reduction is a function of two variables; the overall rate of economic growth and the share of any increment in growth that is captured by the poor. Education has a bearing on both sides of the equation. Improved access to good quality learning opportunities can strengthen economic growth by raising productivity, supporting innovation and facilitating the adoption of new technology (Bourguignon, 2000).

Furthermore, HCT suggests that high economic growth and development will take place with highly skilled productive and efficient labour forces. Formal education is instrumental and necessary to improve the production capacity of a labour force. In short, “an educated population is assumed to be productive'' (Fagerlind, and Saha, 2004).

The rate of return to investment in education is a measure of the future net economic payoff to an individual or to society of increasing the amount of education taken. As a measure of profitability, the rate is equivalent to the interest paid on savings or the rate of return to investing in a machine, real estate, of any other form of capital requiring a stream of investment over time and an income return over time.

Rate of return to educational investment as social and private returns are highest for primary education. The private returns exceed social returns, especially at the tertiary level. The rates of returns to investment in education are above the 10% criterion of the opportunity cost (OC) of capital and, the rates of the return are higher in less-developed countries than developed countries at a comparable level. (Psacharopoulos and Patrions, 2004)

58

Table 3-1 Results of the estimates of the return to investment in education by level

Types of returns Primary Level of Education (as in %) Secondary Level of Education (as in %) Tertiary Level of Education (as in %) Private Return 26.6 17.0 19.0 Social Return 18.9 13.1 10.8

Source: Psacharopoulos and Patrinos (2002).

The link between education and economic growth, income distribution and poverty reduction are well established. Education equips people with the knowledge and skills they need to increase income and expand opportunities for employment. This is true for household and for national economies. Level of productivity, economic growth and patterns of income distribution are intimately linked to the stage of education and the distribution of education opportunity. Increasing global economic interdependence and the growing importance of knowledge-based processes in economic growth have raised both the premium on education and associated education deficits (EFA-GMR-2009).

On agricultural productivity, four years of primary education increased farm productivity by an average 8.6% and that agricultural productivity was more influenced by education in modernising than in traditional environments.(Lockheed, Jamison and Lau 1980).

One study of fifty countries for 1960 to 2000 revealed that an additional year of schooling lifted average annual GDP growth by 0.37% and, when that was combined with improved cognitive skills, the figure rose to 1%. Another found that an extra year of schooling could increase individual earnings by 10% (EFA-GMR-

2009:9).

In order to make a significant contribution to the economic growth and development of the nation, education acts as a catalytic agent. Formal education imparts the requirements and essential basic skills and knowledge to tackle newly emerging challenges and obstacle in real working life and ultimately is necessary to improve the productive capacity of the population.

59

Education and training are considered as a means by which the required expertise and knowledge to make a worker more productive will be updated and transferred. The worker will get a return on their investment later in life through higher wages and incentives. More resources invested in education will produce a more educated manpower, which will ultimately directly or indirectly contribute to the national economy (e.g. through taking a job, being self-employed and running businesses). Also, it will help substantially to reduce a high level of child mortality, and crime rates and will raise the standard of living in a society

Due to their up to date skills and knowledge an educated population will contribute effectively and efficiently directly to the national economy, with maximisation of production. As a result, the per unit cost will reduce and the producer can offer competitive prices in the market with a high possibility that demand may increase, so that additional revenue for the government will be generated. This revenue can be used by the government to provide more social welfare for the nation which ultimately will help to increase the quality of life of the people.

Education has long been considered a path to social and economic development and plays a crucial role in strengthening society by increasing the quantity and quality of the human capital in the economy. When education is broadly provided and reaches the poor, girls and marginalized groups, it offers the prospect that economic growth will be broadly shared. Furthermore, greater equity in education can help fuel a virtuous cycle of increased growth and accelerated poverty reduction, with benefits for the poor and for society as a whole. The eventual objective of HCT lies in economic growth at the national level and education is a worthwhile object for investment for that purpose. In other words, education is the ‘means’ or input and economic growth is the ‘end’ or outcome of development in this theory.

The economic growth and development of a nation will occur effectively and efficiently by using more advanced technology with a more highly-skilled labour force. This utilisation of competent and skilled labour forces and the employment of technology will result in competitive production.

60

Finally, HCT assumes that there is a strong positive correlation between investment in education and economic growth and development. An additional year of schooling or level of education will significantly contribute to productivity and help to increase the amount of income that a person can earn. In other words, a well educated and well trained labour force with wider and up to date technological and managerial knowledge, skills, and competencies will significantly contribute to the increased efficiency and productivity of an organisation. Finally, investing more in people will help to increase the economic growth of the national economy of a country.