This article complements the one written by George Psacharopoulos. It builds on the market returns to education that are measured by increments to earnings and to pure economic growth. It considers the additional nonmarket private returns to education, but it also considers the social benefits of education that benefit others in the community and future generations. Both of these benefits have enormous relevance to education finance. Understanding the private nonmarket benefits and their value is highly relevant to how much should be invested in education. The size of the social benefits, some of which are market benefits, is relevant to how much of the total investment in education must be financed publicly. The main issues to be addressed in this article include: (1) What are the main nonmarket benefits of education?; (2) How can they be distinguished from market benefits and from social benefits, some of which are also market benefits?; (3) Why must a dynamic view of the process that includes indirect effects that feed back to set the stage for further growth be understood before most education externalities are seen?; (4) How large are the nonmarket returns and externalities for secondary education?; and (5) For education finance policy, what is an economically efficient total investment in education as, say, a percentage of gross domestic product (GDP), and what is the appropriate public share? (Contains 3 figures and 2 tables.)