Education as a hedonic good

Parental investment choices concerning a child’s education are unique.  These choices involve decision behaviour more commonly associated with hedonic goods while simultaneously leading to utilitarian outcomes with objective trade-offs.  The utilitarian outcomes are clear and well documented.  For an individual, increased investment in a child’s education leads to higher future earnings, better health and increased life expectancy. Hedonic goods on the other hand are characterized by choices strongly influenced by emotional conditioning, social positioning and the context of personal expectations (Rayo & Becker 2007).   Hedonic choices are usually infrequent making it difficult to maximize utility through repetitive refinement, Arrow’s (1962) ‘learning by doing’.

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