Economy Behind Education I read the article of Student-Loan Debt Among Top Occupy Wall Street Concerns on Wall Street Journal. The case describes that the student loan in America has reached $1 trillion. Americans began to owe more on their student loans then their credit cards last year. However, students who take loans are still worried about getting a job after graduation. Some loans maybe deferred or defaulted. The topic I am very interested in is the economics of education. I am a Chinese student. The tuition we pay to receive education in United States is much more expensive than in China.
The fee of a course can be more expensive than the total fee of 1 year’s university life in China. And yet, more and more Chinese students are going to American universities. The economy behind is that Chinese is developing so quickly, more and more families are able to afford children to study abroad. The one-child policy has been for many years, and many families in China have 1 child, so parents tend to let their only child receive the best education. That’s why when the economy of many Asian countries like India developed, the number of Chinese students become the largest of all the foreign students in America.
On the other hand, American universities are willing to accept more Chinese students in order to get tuition. The majority of the Chinese students of America are graduate students. The economy behind this is that graduate programs usually last for 2 years, and undergraduate for 4 years. Undergraduate programs are usually more expensive than graduate program. So there is limited number of Chinese students in undergraduate programs in American universities, but getting larger because of the growth of the income of Chinese families.
More Chinese are questioning whether the Chinese higher education is valuable, and taking foreign universities into consideration when applying for universities. Education loan reflects the economic principles. For example, opportunity cost. Students getting loans expect after education, they will get jobs to pay back the loan and earn more money. They assume that education is worthy taking the risk of getting loan. I didn’t get loan to go to university in China and America, but I also thought about opportunity cost, especially when applying for American universities.
In China, although higher education is not cheap, people take it for granted that children should go to university to accept higher education. Some of my relatives send their children to private universities because the scores are not high enough to get into public universities. In China, public universities are considered better than private ones, because they are older and more famous while private education is at the beginning. However, the fee of private universities is higher. But rare parents are not willing to afford the expensive tuition.
According to my classmates, compared to those who haven’t received higher education, college students are a little behind when they go to work. But they usually can go further in their career because of their accumulation of knowledge and thinking in the universities. So in my opinion, the education loans can help build the higher education, as long as they are safe enough. At the same time, more people can receive higher education, so that they can possibly do a better job after graduation. However, in the background of the financial crisis, the effect of huge amounts of loan is unknown.