Higher Education in a Context of Slower Growth

Abstract

　 Japan experienced an epoch of high economic growth up to the early1990s followed ever since then, by a low growth rate. Nonetheless, the participation rate in higher education continued to increase even in the latter period. What underlay this expansion, and what are the future implications? This paper addresses those questions. In Section 1, I have drawn up an analytical framework that involves the market for higher education opportunities （the higher education market）, the market for college graduates, the financial market, and the government. In Section 2, I examine the factors that contributed to the changes in the higher education participation rate in three periods since the 1960s. I show that the participation growth since 2000 owes much to the increased use of education loans, tapping the resources of the financial market. In Section 3, I examine the case of the United States from similar perspectives. I argue that, while the monetary market has played a significant role since the 1990s, the behavior of higher education institutions in the U.S. is different from the case of Japan. On the basis of these observations, I discuss the possible direction of future higher education policies in Japan.