Abstract Economists usually concentrate on the productive aspect of education; it is the most important way by which societies can, and do, invest in human capital. The fact that education increases the skill levels of individuals and contributes to the rise and spread of technological progress is beyond dispute. One may ask, nevertheless, how large these effects are, who pays the costs and who obtains the benefits. It is a type of investment where public financing is substantial, even in countries where the level of state participation in economic activity is otherwise low.