Higher Education Financing in the Age of Globalization

A New Paradigm Drawing on Economic Theories

Abstract

　 Increasing demand for student enrollment, surging education costs, declining governmental revenue, increasing globalization, and growing economic liberalism are the challenges currently faced by almost all the OECD countries as they make efforts to finance higher education in their respective countries. This paper attempts to explore why these advanced economies are facing such challenges, drawing on economic theories concerned with such factors as global mobility, skill distribution and economic returns to education. At first glance, it seems that the increased mobility of students, scholars and skilled individuals accompanying globalization and economic liberalization is likely to bring about even greater shrinkage in government budgets. Nonetheless, ensuring equity of access on the one hand, and securing skilled human resource on the other, have been increasing in importance, and these issues fall within the purview of national governments. Demands have been made for the introduction of a new paradigm in the balance between public and private cost-sharing through innovative government involvement in higher education funding.