This thesis examines the dramatic increase in the social demand for education, especially at the tertiary level, in Greece during the past twenty-five years. In the context of Human Capital theory a variety of public and private data sets, covering nearly 29,000 employees, are analysed and presented for the period 1960 to 1987. The results indicate that (i) the rate of return to education has declined considerably during the post-war period. It dropped from about nine per cent in the early 1960s, to almost five per cent in the mid-1970s, then declined further to about four per cent by 1981, and finally levelled at about three per cent in 1987. (ii) There is not enough evidence to support the existence of "screening" or the "certification" effect of education in Greece. (iii) The teaching profession is found to be relatively underpaid compared with other occupations requiring almost the same levels of human capital. According to this study the main reason for the declining rate of return during the last decades is attributed to the substantial rise in the average years of schooling of the population, that is, from 5.0 years in 1961 to 6.9 years in 1981. Equally interesting has been the change in the number of Greek students abroad. During the period of expansionary policies in the Government sector, the number of Greek students abroad increased from 7,000 in 1960 to a peak of about 45,000 in 1982, and has recently dropped to almost 27,000 with the adverse economic developments in the 1980s. These findings lend support to the economic explanations of education and, in particular, the Human Capital approach. The thesis is concluded with the examination of some educational policy options which are evaluated against equity-efficiency criteria.
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