The rate of return on investments in higher education, defined as a measure of productivity that relates the costs of resources expended in instruction to the value of benefits produced, is discussed and computed for several student populations. The concepts of "overeducation" and "underemployment" are also discussed. (SF)

An analysis is made in this speech of the rates of return on investments in higher education. Results indicate that the annual rates of return are higher in every year (1961-75) than the 10 percent realized on business investments. On the basis of the evidence presented, it is concluded that Americans are not overeducated. The trends in student…

Negative hypotheses that universal education will lead to unqualified students, oversupply of graduates, unemployment of graduates, lower earnings for graduates, and declining personal and social benefits of investing in higher education are rebuffed. The case is made that social returns on investments in higher education continue to be high.…