Education As the Consumption and Investment Economics

Micro economics education learn the elements of demand, supply, and price of product education services. At the request of the elements learned about how prospective students to maximize the net revenue expected lifetime. Who's on the producer, namely education units to learn about how to combine inputs in order to obtain the lowest total cost, therefore, the discussion will also be related to the discussion about education as an industry.
Education organized by educational institutions, in which educational institutions may establish one or more educational units, then this means that the institution has a position as a business entity, and education units such as elementary, junior high, high school, vocational school, and programs of study in college serves as the company (firm).
In addition, because the product of education in the form of services, it is necessary to note also about the characteristics of the service industry, in this case is education services.
Market, Demand, Supply and Education Services
Education is the overall market demand and supply on a particular type of educational services. Just as in the economic field, then the market in the education market can be divided into concrete and abstract market. Judging from its shape, the education market have in common with market competition monopoly. Talking about the education market, then at least there are two important elements, namely the education demand and supply of education.
About the education market there are several definitions. Among other things suggested by Hector Corea, he argued that the demand for education illustrates the need, and is manifested by a desire to be a specific lesson. There are several factors that affect demand for education such as cultural, political, and economic. Then, individual educational demand in the aggregate is affected by factors such as: parental income, parental education, parental employment, education, public policy (government), policy institutions, and individual perceptions of each type of education. Demand for education also depends on the perspective, that is whether education is considered as consumption, as an investment, or consumption and investment.
Educational offerings can be viewed at the macro and micro. At the macro level, the provision of education can be implemented on the basis of employment approach. Who's in micro, namely the procurement of education at the unit level of education, such as a junior, a high school education and sebagainya.Terlepas by whom it was held, then the procurement process of education should be carried out effectively and efficiently.
About the price of education. To determine the price of education services is not simple, as the price of goods. Since many components that must be calculated, including the registration fee, registration fees (BP3, etc.), money summative tests, reports money education, money re-registration, and so forth.
Then about price elasticity. The price elasticity or the elasticity of demand for education is the comparison between the relative changes of demand for educational services with relative change of the price. In accordance with its market form, ie monopolistic competition, the nature of the elasticity of demand is inelastic.
Education as Public Goods and Private Goods
Education can be a public goods and private goods can be. Public goods (public goods) is a type of goods that are needed by society, but nobody is willing to produce it. There are two main characteristics of these goods, namely nonrival consumption and non-exclusion. Based on the definition and properties of public goods, for education can be classified as public goods, it must meet the following criteria:
1. Education should be the goods / services consumption.
2. Education is needed by everyone.
3. Private parties are not willing to produce it.
4. Education, consumption has nonrival nature consumption and non-exclusion.
In accordance with these criteria, then the basic education or compulsory education consisting of primary and secondary school can be classified as public goods. There are some underlying theory of public goods. The theories put forward by Bowen, Eric Lindahl, and Samuelson. All three theories are in principle talk about how the procurement and loading costs.
Education can also be classified as private goods. Private goods (private goods) is their provision of goods is done through market mechanisms. Included in this category is at the level of education after compulsory education, namely high school (SMU and SMK), and Universities. At this level of provision of education is not only driven by motivations that are religious, and nationality, but also driven by business considerations. Thus, the presence or absence or extent of production of education is influenced by the extent of demand and revenues that may be received by the organizer / manager in the future.

Education as consumption and as an Investment
Education can be viewed as consumption, as investment and as consumption and investment are complementary. Education as consumption is education as a fundamental human right. Or is one of the democratic rights of every citizen. So until a certain level of procurement should be done by the government. Therefore, in many countries basic education (primary and secondary school) were used as compulsory education. As a consequence of education at this level of education not only as a right, but also as an obligation for every citizen at a particular age level (in Indonesia between 6 and 15 years).
In terms of the nature of needs, procurement of education at this level is a public good. Then views of motivation, then education as consumption is motivated by a desire to satisfy the need for personal development, social needs, the need for knowledge and understanding. Furthermore, the orientation time is now. Demand for education is influenced by the size of disposable income.
Education as an investment objective to obtain net income or rate of return is greater in the future. Education costs in this type of education is viewed as the amount of money bought to acquire or invest in a number of human capital (human capital) that can enlarge the economic capacity in the future. Education as an investment based on the assumption that man is a form of capital (capital) as other forms of capital that are critical to the growth of productivity of a nation. Through his investment someone can expand alternative to other activities so as to improve the welfare of his life in the future.
Education as consumption and investment are complementary.
Education after compulsory education has the aim not only to acquire knowledge, understanding, personality development, and the satisfaction of social needs (status and prestige) as well as to obtain better jobs, so it can earn net income for life is higher in the foreseeable come.
In accordance with the above description, the amount of education acquired by a person will have high impact on low income that he obtained, though not fully guarantee. But the trend is quite large.