Private Demand,Social Equity and Adult Education in Singapore

There are currently two views about the relationship between education and economic development. One rather narrow view treats education as an investment in people — in human capital — that raises productivity and national income just like investments in physical capital. Rational individuals invest in themselves when they see that private returns exceed private cost. Governments should invest in education that gives favourable social rates of returns. Their main function is to respond to the established pattern of demand for education. The second, and broader, view sees education not as a pure investment good, but as a powerful force that increases people's knowledge, changes their values and attitudes, and thus expanding their ability to absorb new technology. In this view, the expansion of educational opportunities is vital to the making of a modern society. Governments should provide education with the objective of creating a fully educated society — a society where everyone has at least six to ten years of formal education. They should create educational and training opportunities ahead of demand, with subsidies and compulsory schooling laws if necessary.