This paper examines the returns to educational investment in Malaysia and their implications for public-sector resource allocation policies. These policies largely define the accessibility of educational facilities for most groups in Malaysian society, and since the resultant pattern of educational attainment impinges directly on personal incomes, attention will also be given to the distributional aspects of public investment in education. The focus of the latter will be upon urban-rural divergences, which in Malaysia touch directly on the question of racial equity. [Download]