In this paper we present arguments for increasingexpenditure on the education
sector. We show that there exist large inequalities in the distribution of education
servicesacrossregions and across genders so that ensuring equal opportunity for all
in education, either for normative or economic reasons, will require large additional
investments in this sector. We also present evidence which showsthat while the rate
of return to education in the country may not be high it has been increasing over
time, so that higher expenditure on the education sector is also economically justifiable.
Enrollments at all levels have been increasing over time, along with household
and institutional expenditure on the education sector, which suggestsa greater
willingnessto invest in education. If the productivity of education is low then it
would be natural to expect a decline over time in the willingnessof the people and
the government to bear the costs of education. But first, we examine the evidence
about the increasing unemployment of educated labour and show that this does
not mean that there is an economic surplus of education in the country, nor that
the education sector is overextended, but that it can be explained by 'search time'.