This study assesses individual and fiscal returns to educational investments in Germany, based on the ZEW microsimulation model. Tertiary education is compared to higher secondary and vocational education and higher secondary and vocational education is compared to secondary education.

Among others the analysis indicates that the fiscal net present value of tertiary edcuation is 100,000 Euro per student, while the net present value of vocational education is 138,000 Euro per student. The fiscal returns of these two types of edcuational investment exceed five percent are above the actual interest rates of German 10-year government bonds which is below one percent. The fiscal returns to investment in vocational education are high because they help to reduce social transfers. Tertiary education produces high returns, because the additional income creates higher taxes. Measured at available income the private return to tertiary education is seven, to vocational education five percent.

Selected Publications

Allowance

Bundesministerium für Bildung und ForschungBundesministerium für Bildung und Forschung, Berlin, DE

Project duration

01.04.2014 - 31.12.2014

Contact
Project members

PD Dr. Friedhelm Pfeiffer (Coordinator)
Dr. Holger Stichnoth