The Empirical Analysis Of Reasonable Education Cost And Influencing Factor

With the background of knowledge economy, the reasonableness ofeducation’s cost is related to the efficience of macroeconomic development,and researches on the influencial factors of the cost are still significantlycontroversial. According to the general definition, the cost of education isdivided into three parts, social contributions, financial investment and personalburden. As the proportion of social contributions is minimal, the cost ofeducation is focused on the analysis of financial investment and personalburden.This study involved two groups of relationship, group one is the relationshipbetween providers and recipients of the education, and that is the linkagebetween schools and individuals. At this time, the school provides educationand individuals receive education; the former called as the educational supplywhile the latter as the level of education. Group two is the relationship betweenindividuals and companies, when individuals have the skills through education,they provide skilled labor to meet the needs of firms, then individuals areproviders and firms are the demanders. To avoid confusion, we regard theeducational suppliers-society, schools and government-as the suppliers ofeducation, personal choice as the level of education, and the educational needof firms as the educational demand.In this literature, with the assumption of individual utility maximization, theindividual choose their own level of education, firms choose the needs ofeduaction under the considering of maximize profits, thus we derive areasonable equilibrium solution of the education’s cost. Following the valueestimations of the equation parameters of scholars at home and abroad, weuse the method of numerical simulation, depict the corresponding relationshipbetween the interest rates, capital stock and the cost of education in differentinformation symmetries. Our analysis showed that the rise of informationsymmetry contributes to social efficiency, making the capital accumulationbecome more sensitive to educational needs and the increase of schoolingyears, and thus improve the efficiency of social allocation. In addition, the riseof real interest rates in any information symmetries will lead to the behavior ofthe short-sight on the choice of schooling years, and reduce the sociallyacceptable cost of education.Then, we attempt to quantify the loss of social utility when the cost ofeducation has been distorted. By adjusting the coefficients, we solvedimensional chaos and other difficult questions in the process of normalization.We draw the education demand curve without explicit expressions by the useof calculus, and find that individuals take the consequences of the loss of distortion while it has little effect on corporate profits. Through domesticinter-province panel data analysis, we verify the conclusions of mathematicalmodel and numerical simulation. Finally, by the use of spatial econometricmodels, we study the impact factors and spatial correlation of the financialeducation input as an important part of investment in education, indicating thatWagner-rule does not hold in current China, and the investment in educationhas not been synchronized with the increase in economy growth.