An Empirical Analysis of Household Expenditure on Engineering Education in Odisha

Abstract

There are limited studies on household expenditure on higher education in India, and understanding the factors determining household investment in engineering education is almost absent. However, with the increasing presence of private sector, it is important to examine the changing pattern and determinants of household expenditure on higher education, which would help to formulate evidence-based policies in India. In this context, this article analyses the variability of household expenditure on engineering education and its relationship with socio-economic and institutional factors, using the data collected through a student survey in Odisha, an eastern state of India. We find that, on average, a household spends around 30 per cent of its annual income per child for an engineering degree. The study confirms the presence of a pro-male bias in household expenditure on engineering education, and interestingly, an additional preference is observed among poor households. Robust ordinary least squares (OLS) results show that students enrolled in private engineering colleges have spent significantly more than those enrolled in public-funded institutions. Contrary to the established literature, students belonging to lower socio-economic groups are shown to have spent more on non-fee items than forward social groups, though they have spent relatively less on fees.