Demand for education investment in a model with uncertainty

Many reports of the relevant literature describe studies of education investment. As undertaken by Glomm and Ravikumar (1992), we also consider public and private school education in the study described herein. However, unlike the related literature, our model setting incorporates private tutoring and uncertainty about the productivity of human capital accumulation. Based on Bearse, Glomm and Patterson (2005), our paper presents consideration of uncertainty about education results and presents an examination of how demand for education investment is determined. Results demonstrate that, because of uncertainty about education results, demand for education investment is less than in a case with no uncertainty.