The political economy of Saudi Arabia: Investment in human capital and the economics of higher education

The purpose of this study was to investigate the equity of investment and financing of higher education in Saudi Arabia. Higher education has been seen by many scholars as an economically and socially productive investment. Many governments in the world, including Saudi Arabia, expressed their faith in higher education to bring about economic and social equality by providing higher education at low or no cost to the student.;A discussion of the role of government in education was provided in chapter III. A brief discussion of the Saudi Arabian economic environment and a brief description of the educational system was given in chapters IV and V.;The study employed a questionnaire that was distributed to a total of 500 students in King Abdulaziz University and secondary school seniors in Jeddah City and Rabigh. The study examined the student's perceptions and socio-economic background.;The study found that the present financing policy of higher education fails to satisfy either equity or growth goals. The system is catering to the offspring at the upper urban middle classes and the urban middle classes. The rural and poor population are under-represented in the university student body.;A review of the literature was undertaken to give some background in the concept of human capital and the economics of education. The review of the literature shows that such strong belief in the higher educational system as a method of social change has given way to new reality. Studies have shown that education does not lead to the objective of equality.;The study proposed a cost recovery method based on a loan program that will help to equalize the distribution of the national resources.;Information found through this study can be used in the future by the government in developing a more effective financing policy for the higher education sector.