Abstract
In this paper, we discuss economic effects of EU higher education policy from the view of EU governance. The higher education is also focused in “Lisbon Strategy”, to strengthen international competitiveness of EU economy.
Though two perspectives, micro and macro ones, study education policy, we employ the macro perspective, which suggests human capital accumulated by education has externality to macro economy. By existence of the externality, intervention by EU to higher education is rationale.
We estimate increase of graduation ratio of higher education brings about higher per capita real growth rate. The estimation method is pool-estimation for EU 12 member countries. The explanation variables are ratio of graduation of higher education, ratio of graduation of second education, ratio of graduation of first education, growth of openness of economy, and growth of employment.
However, the current governance framework of EU, Open Method of Coordination, for further increases is limited because of fund constraint and introduction of common standard for higher education in EU member countries. We, therefore, suggest change of EU governance for higher education to Co-regulation framework in order to increase ratio of higher education. The framework will be also important for strengthening of international competitiveness.
