The Ministry of Education, Culture, Sports, Science and Technology launched“the 21st Century Center of Excellence (COE) Program”in fiscal year 2002. Right after the COE program, the Distinctive University Education Support Program (Good Practice [GP] ) started as an educational version of the COE program in fiscal year 2003, and the program expanded to various educational areas thereafter. Because of the overwhelming growth of demand for higher education services, the postwar Japanese higher education policy based mainly on the university chartering standard as an exante qualification of higher education. But since 1991 as the rapid reduction of 18 age population started, the Japanese higher education policy changed to a more competition and deregulation oriented ones. The ministry's new policy aims to bring about more vigorous competitive environment for the inter-university competition through national, public and private universities. Using the data of 499 universities which applied to the COE program and/ or the GP program, this paper examines the recent competition oriented policy using several numerical analyses. Some findings are as follows (1) the Japanese higher education policy which based mainly on the university chartering is found to be useful to assure the quality of research in national universities, (2) but which also brought forth the quality differ-entiation in research between the national, public and private universities, and the uniformity of education through these universities, (3) the GP programs which originally aimed at the improvement in the educational quality through the competitive subsidization, choose university programs whose quality of research are high.

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Recently Japanese government carries out the structural reforms on relation between central and local government. The reconsideration of local allocation tax grants is one of the most important themes in Japan.
Local allocation tax grants, which contain“ordinary local allocation tax grants”and“special local allocation tax grants”, are required to operate objectively. Ordinary local allocation tax grants have rigorous formula of determining the amount of grants, so it is considered that there are no interventions from any participant, such as politicians or bureaucrats.
However when it comes to special local allocation tax grants, there has less rigorous formu-las than ordinary grants, it is wondered that bureaucrats are able to control the amount of the grants.
First, we construct a theoretical model which describes the bureaucrat's behavior. There are two type bureaucrats, incumbent and retiree, who are over lapped in the economy. We show that both incumbent and retired bureaucrats choose a trigger strategy which supports positive transfers from incumbent bureaucrats to their seniors.
Second we estimate the regression model that formulates the structure of grants. The empirical results support our theoretical model; there are positive transfers from present bureaucrats to senior ones who become now local governors. We also find the positive correlation between the grants and intergovernmental personnel exchanges. In other words the increase in the number of central government officers admitted to the local government leads to the increment of special local allocation tax grants. With using the estimators and explanatory variables, we calculate the amount of the influences of bureaucrats on special local allocation tax grants. It is estimated that about 50% of total amount of special local allocation tax grants are determined by influences of bureaucrats.

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In this article, the authors try to understand the factors affecting government consumption, government fixed investment, and total disbursements among 19 OECD countries. Many empirical analyses have ever tried to explain the reason why welfare states expanded after the WW II, by focusing on industrialization factor and/or political factors. In the 1990s, great advance of econometric method allow to test several theories by using Time-Series Cross-Section data, and this trend stimulate the effort to quantify the political and institutional character traits of the countries.
Our analysis, using TSCS data for 19 countries over the period from 1975 to 1999, is distinctive at least two ways. First, in, contrast to former studies, we focus on the period when most OECD countries do not necessarily expand after oil shock. Second, we can use many important political and fiscal variables, which former studies could not use. The estimation result with two-way fixed effects model shows that those countries in the bad fiscal situation might rein in government consumption and total disbursement. It suggests that not only fiscal demand increase expenditure, but government fiscal constraint might hold down expenditures. Also, we confirm that increase in total trade have been associated with less government expenditures. This result supports “efficiency hypothesis” which claims globalization trend put pressure on governments to cut back expenditures. In addition, our estimation shows different result which is expected from traditional “Wagner's Law”, which claims increase in GDP per capita would expand gov-ernment expenditure.

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