Continuous investment in education is a key factor in economic growth and development. Investing in education is an investment with a returns on investment and with multiple positive effects at the private and social levels. Earnings in the labor market represent private returns on investment in education and their measurement is in the center of the scientific literature. The main objective of this paper is to analyze modern theoretical and methodological approaches to measuring returns on investment in education, while analyzing the measurement methodology, indicators used and data sources. The scientific contribution of this paper is based on a concise and critical review of the scientific literature and trends in this field, with reference to the methodology used and indicators in measuring returns on investment in education.

Abstract Education plays a central role in today’s understanding of growth and development dynamics. However, its relationship with other factors is complex. This paper aims to investigate the effect of different forms of education on youth employability in Bosnia and Herzegovina. This is done by using the USAID MEASURE – BiH National Youth Survey. Research has shown that formal education and non-formal education through internship programmes, volunteering, paid jobs other than internships are significant predictors of youth employment status. The study also has several implications for academics and practitioners since it provides new insights into both employment patterns and practices in one transition economy but also calls for further analysis of the link between education, formal and non-formal, and youth employment.