Avyay Tivari
The gross tertiary enrollment rate of the world was 43.61 per cent in 2024. India’s tertiary enrollment rate was 34.42 per cent in the same year. We have to increase this rate if we want to develop further but this needs a large investment in higher education. The resources that should have been invested in higher education are being wasted currently. We can understand this through the concept of opportunity cost in the context of the recent protests of students.
In a world of scarcity choosing one thing means giving up something else. The opportunity cost of a choice is the value of the most valuable alternative forgone.
Most people think that the cost of preparing for competitive examinations is limited to tuition fees, the cost of books, and the cost of travelling. This conventional understanding does not include a crucial component. Preparing for competitive examinations forces students to forego the opportunity to work and earn. I will elaborate on this through an example.
Let us assume that the annual fee of a coaching institution and additional expenses are Rs 3 lakh. Looking at the situation through the concept of opportunity cost we can understand that one is not only paying fees but also losing out on money one could potentially earn by working. Let us assume that a Grade-12 graduate can earn Rs 20,000 per month. During this one-year period one foregoes Rs 20,000 per month X 12 months = Rs 2,40,000. The total opportunity cost is Rs 3 lakh + Rs 2.4 lakh = Rs 5.4 lakh. From the above calculations, we find that the actual opportunity cost in this case is 80 per cent more than our first estimate.
A majority of the students prepare for 2-3 years as acceptance rates are low. This means that the opportunity cost of preparing for competitive examinations ranges from 10.8 lakh to 16.2 lakh. Lakhs of students in India are actively preparing for such examinations, which means that a lot of resources are wasted.
Why do students join coaching institutions even though the syllabus for examinations such as NEET and JEE largely include concepts taught in Grades 11-12? Most schools do not offer high standards of education which forces students to find alternatives.
If we want to increase tertiary enrolment without exhausting the resources of students we need to improve the quality of education in schools and subsidise higher education for young individuals who are financially weak.
