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Standardized Sensitivity Analysis in BCA: An Education Case Study.

Elina Pradhan1, Dean T Jamison2

  • 1Elina Pradhan, The World Bank Group, Health, Nutrition and Population Global Practice, Washington, DC 20433, USA.

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|September 28, 2020
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Summary
This summary is machine-generated.

Adding the value of reduced mortality risks to wage increases significantly enhances education

Keywords:
D61I1I15I18I26O2education and human capitalhealth

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Area of Science:

  • Economics
  • Public Health
  • Education Policy

Background:

  • Education policy analyses often focus on wage increases.
  • Female education is linked to reduced child and adult mortality.
  • Comprehensive analyses should include mortality risk reduction benefits.

Purpose of the Study:

  • To estimate the impact of valuing mortality risk reduction on education policy benefits.
  • To assess how benefit-cost ratios change with different valuations of mortality impacts.
  • To analyze one additional year of schooling in lower-middle-income countries.

Main Methods:

  • Standardized sensitivity analysis to value mortality risk reduction.
  • Inclusion of income and age adjustments for mortality values.
  • Calculation of net benefits and benefit-cost ratios.

Main Results:

  • Benefit-cost ratios range from 3.2 to 6.7.
  • Net benefits range from $2,800 to $7,300 per student.
  • Mortality risk reduction accounts for 40-70% of total benefits.

Conclusions:

  • Including mortality benefits substantially increases the value of education investments.
  • Education policies offer significant returns when considering both economic and health impacts.
  • This comprehensive approach highlights the multifaceted advantages of education.