An application of cost-benefit analysis to management education

Abstract

This paper develops a theoretical framework for the application of cost benefit analysis to management education in developing countries. Social returns are estimated through a combination of the import substitution and income creation approaches, both of which are considered in the evaluation of investment. The cost-benefit analysis of a major national project in India within this framework shows that its educational pro gram has a positive net present value even at a social discount rate as high as 13 percent. The net returns appear to be quite sensitive to the values assigned to the foreign exchange rate, discount rate, and price elasticity.