HE Policy and Welfare Regimes

Higher Education Policy, 2011, 24, (25 52) r 2011 International Association of Universities 0952-8733/11 www.palgrave-journals.
com/hep/
Higher-Education Policies and Welfare Regimes: International Comparative Perspectives

Hans Pechara and Lesley Andresb
Faculty of Interdisciplinary Studies (IFF), Vienna Location, Institute of Science Communication, & Higher Education Research, University of Klagenfurt, Schottenfeldgasse 29, A-1070 Vienna, Austria. E-mail: hans.pechar@uni-klu.ac.at b Department of Educational Studies, University of British Columbia, 2125 Main Mall, Vancouver, British Columbia V6T 1Z4, Canada. E-mail: lesley.andres@ubc.ca
a
All Organisation for Economic Cooperation and Development (OECD) countries have experienced an unprecedented expansion in higher education during the second half of the twentieth century. This was only possible because higher education became part of national welfare policies. OECD countries differ, however, with respect to the significance of education, and more specifically, higher-education policies within their overall framework of welfare policies. We employ the concept of the welfare regime and a trade-off hypothesis to understand the different national approaches to highereducation participation, funding, tuition, and student financial aid. Through a comparative analysis of data from international databases, we examine how different countries accomplish the goal of enhancing participation as part of their welfare policies. Overall, our hypotheses are confirmed in that we demonstrate that there is a convincing relationship between higher-education policies and given welfare regimes. We conclude that when adopting policy strategies from other contexts, careful consideration of the underlying societal structures and traditions is required. Higher Education Policy (2011) 24, 25 52. doi:10.1057/hep.2010.24 Keywords: welfare regimes; trade-offs; funding
At present, all Organisation for Economic Cooperation and Development (OECD) countries are confronted with higher-education policy dilemmas (Martins et al., 2007; OECD, 2008c). On one hand, in order to increase the knowledge and skill capacity of the labour force and enhance citizenship and well-being of the population, governments try to increase participation in higher education. Also, enhancing participation by traditionally disadvantaged groups remains high on the policy agenda of all OECD countries. On the other hand, it is increasingly difficult to raise sufficient financial resources to meet the needs of an expanding higher-education system. Most OECD governments face fiscal constraints that limit their capacity to increase public resources accordingly (Johnstone, 2006). Despite considerable attention in recent years to these issues, little research has been directed toward a comparative analysis, which embeds these policy
Hans Pechar and Lesley Andres Higher-Education Policies and Welfare Regimes
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debates within the social fabric of each respective country. Through a comparative policy analysis, our paper does so by contextualizing highereducation policies within a welfare regime framework. The key for a meaningful comparative analysis is a comprehensive understanding of the trade-offs with which each country is faced when endeavouring to expand its higher-education system. It is simply not possible to achieve all of the following goals at the same time: low taxation, low or no tuition fees, high non-repayable student aid, and a high participation rate in adequately funded higher-education institutions. Policy decisions are necessary to prioritize these goals all of which are advocated by at least some interest groups. How countries deal with and respond to these trade-offs largely depend on their welfare regimes and the political traditions within which they are embedded and upon which they rely. We propose that the concept of the welfare regime is a useful analytical tool to understand the different national approaches in higher education funding and development.
Conceptual Perspectives
Considerable variation can be observed in the social policies of advanced industrial nations. According to Hega and Hokenmaier (2002, 2), the specific nature of their provisions for healthcare, work injury, unemployment compensation, and old age pensions bear important consequences for the socioeconomic opportunities and outcomes of individuals and groups. A nations social programs reflect the socioeconomic and political institutions that shaped them. Categorization and classification of public social policies according to their content and extent of their provisions has resulted in the development of national profiles that have been further aggregated into typologies of welfare state regimes. The latter has been accomplished by generating categories according to the similarity of their social programs, by their tendency to produce similar and distinctive public policies (ibid.). In this paper, we employ the typology of welfare regimes advanced by EspingAndersen (1990, 1999). Although other schemas exist, Esping-Andersens typology is described as a modern classic (Arts and Gelissen, 2002) that has dominated the field of research on welfare states (Hicks and Kenworthy, 2003). We prefer this framework as it incorporates a complex set of policy dynamics embedded within the state, market, and family. As Esping-Andersen (1999, 4) argues, such an approach allows for the interaction between the composite parts that, in unison, form contemporary welfare regimes. It is beyond the scope and page limitations of this paper to provide an extensive review of the literature. For such reviews, see for example, Arts and Gelissen (2002), Bradley et al. (2003), Hicks and Kenworthy (2003), and Starke (2006).
Higher Education Policy 2011 24
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However, another related body of literature is worth mentioning. Iversen and Stephens (2008) have compared the welfare regime typology with the production regime approach of the varieties of capitalism theory (Hall and Soskice, 2001). The latter approach specifies differences in liberal market economies and coordinated market economies by contrasting the extent to which different regimes focus on general vs specific skill formation and the extent to which they provide vocational training. The interrelationships among social insurance, skill formation, and financing public education are central to the production regime typology. The extent to which each is embraced defines the location of a given country into one of the three worlds of human capital formation defined in this approach. Iversen and Stephens explicate how relationships among institutions, political parties, and electoral systems influence and shape skill formation regimes. Elsewhere, we (Pechar and Andres, 2010) have employed such a comparative approach to examine educational and skill formation in secondary and tertiary education. In this paper, however, we focus on tertiary education and hence our conceptual lens is directed on general level skill formation.
Welfare Regimes
Esping-Andersen (1990) identified three types of welfare regimes that are shaped by political traditions and are characterized by coherent patterns of welfare policy. He describes different welfare regimes as qualitatively different arrangements between state, market, and the family (p. 26). A key concept of this typology is de-commodification, which refers to the degree to which individuals, or families, can uphold a socially acceptable standard of living independently of market participation (p. 37). The main criteria employed in Esping-Andersens typology is de-commodification of welfare provisions for old-age pensions, healthcare, and unemployment compensation (p. 50). The three types are as follows: Liberal welfare regimes (e.g., Canada, USA, Australia, New Zealand, and UK) are characterized by a low degree of de-commodification and a strong role for markets in the production of welfare. In liberal regimes, states provide a residual function; that is, the state assumes responsibility only when the family and market fails; it seeks to limit its commitments to marginal and deserving groups (Esping-Andersen, 1990, 20). Other characteristics include heavy reliance on minimal means tested benefits for clientele of low income (which often leads to stigmatization when receiving such benefits) and subsidies to private welfare schemes. Conservative welfare regimes (e.g., Austria, France, Germany, Netherlands, Italy, Switzerland, and Belgium) are characterized by a strong corporatist
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legacy and a commitment to preserve social structures and hierarchies, and in particular the traditional family. They are dominated by status-preserving social insurance schemes. Conservative welfare regimes support preservation of the status quo and its inequalities. Social rights are attached to class, status, and work effort. The primary provider of welfare insurance is the state, with the market and private insurance playing only marginal roles. Social-democratic (universal) welfare regimes (e.g., Denmark, Norway, Sweden, and Finland) are characterized by universal benefits based on citizenship, equal access to benefits and services of high standards, and a high degree of de-commodification. Welfare coverage is universal and the state attempts to treat all citizens equally and at a much higher standard than minimal need. The goal is to guarantee the individual and families a socially acceptable standard of living independently of market participation (EspingAndersen, 1990, 37) without discouraging individual aspirations or denying the opportunity for private socio-economic achievement. This typology has been criticized for not including education as part of the policy packages of welfare regimes. Although Esping-Andersen (1990) clearly delimited his attention and empirical investigation to income maintenance, pensions, and health services, he did acknowledge the importance of education as part of welfare policy: What, then, constitute salient dimensions of welfare-state stratification? Apart from its purely income-distributive role, the welfare state shapes class and status in a variety of ways. The educational system is an obvious and much studied instance, in which individuals mobility chances not only are affected, but from which entire class structures evolve.y[Moreover], the organization of social services, particularly for women, is decisive for a nations employment structure. (Esping-Andersen, 1990, 58) Moreover, he points out that except for the examination of the role of education in mobility studies, job attainment in relation to the welfare state has been largely unexamined (p. 146). In his more recent writing, he addresses the importance of education more directly (Esping-Andersen, 2009). Hokenmaier (1998) and Hega and Hokenmaier (2002) maintain that education policy should be included both conceptually and empirically in such analyses. After World War II, higher education was incorporated as an essential part of a coherent welfare-policy structure (along with healthcare, education, housing, and employment). However, from the 1950s to the 1970s, as welfare policies proliferated in most OECD countries, systematic differences prevailed. According to Hokenmaier (1998), education policy is clearly one component of a nations total public policy package; and it is not independent of other social policies (p. 710). Hega and Hokenmaier (2002) assert that education
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is no less than other public programs, recognized as a core entitlement in most Western countries (p. 2) in that it allows for upward social mobility, reduces the extent to which individuals are dependent on wage labour and market forces, allows for the ability of individuals to improve their socio-economic status, and hence ameliorates individual overall life chances. As a result, more highly educated individuals are less likely to place demands on social safety nets; in turn, decreased demand will lessen the pressure on welfare states to provide income assistance and other social welfare programs. Castles (1989) points out that because of the possibility that education marches in step to a different drummer from other aspects of the peoples welfare (p. 432), it warrants particular attention as part of the welfare policy rubric. In EspingAndersens (1999) later work, somewhat more of the discussion is devoted to education and skills in relation to equality. However, he invites educational experts to design a workable system of skilling entitlements, one that would befit an ideal postindustrial welfare regime (p. 184). Because the educational policy arena is vast, in this paper we focus primarily on higher education.1 Specifically, we seek to determine the nature and extent to which there is a consistent relationship between higher-education policy making and the different welfare regimes by examining whether systematic differences exist in (1) tertiary2 participation and graduation patterns; (2) pretertiary prerequisites for entry into tertiary education; (3) the role of government with respect to funding higher education; and (4) tuition fees and student financial aid policies and arrangements. However, in order to do so, we need to introduce the conceptual dimension of trade-off into the discussion.
The Trade-Off Argument

By adding education to the mix of social welfare policies to which countries must direct financial attention, we can consider whether and the extent to which educational policy competes with other welfare policies for public sector funding support. A small body of literature has demonstrated this relationship (Heidenheimer, 1981; Castles, 1989; Hokenmaier, 1998; Hega and Hokenmaier, 2002). In an analysis of long term public policy trends in Europe and the USA, Heidenheimer (1981) concludes that a trade-off occurred in the extent to which countries have historically invested in either providing public post-primary educational opportunities or social insurance programs. Castles (1989) explains that the two sets of policy alternatives have different goals. Whereas social welfare policies such as unemployment insurance and old age pensions are intended to ensure equality of condition, the goal of educational policies is to enhance equality of opportunity. This trade-off thesis adds explanatory power
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to the paradox that although liberal regimes exhibit more inequality with respect to most indicators (e.g., income, Gini co-efficient, and housing patterns), they are socially more inclusive than conservative regimes in regard to educational participation and completion rates at all levels beyond post-primary. By directing resources toward education rather than toward policies that would buttress the development of other forms of social welfare, support for public education over social protection programs becomes an alternative welfare state policy strategy (Castles, 1989). The latter is future directed that is, oriented to improving the life chances of future generations, as opposed to supporting equality of condition of the current generation. However, historical funding preference for one set of social programs over the other may lead to difficulties in switching policy directions in the future (Hega and Hokenmaier, 2002). Hega and Hokenmaier add that countries favouring post-primary educational opportunities are signalling that public safety nets exist only as temporary assistance and to buffer the effects of extreme socioeconomic change, not to insulate the individual from every risk of life, societal competition, and market forces (p. 4). In doing so, greater self-reliance on the part of the individual is encouraged and expected and education serves to provide the individual with the necessary human capital to succeed in the market. Some authors have attempted to link the trade-off thesis to EspingAndersens theory of three distinctive welfare regimes by claiming that particular tendencies in educational policy correspond to Esping-Andersens welfare regime types. We agree with Hega and Hokenmaier (2002) that it is a useful exercise to consider this typology in relation to the extent that there is a trade-off between public funding support for education and other social programs in welfare states. In this paper, informed by the findings and following along Hega and Hokenmaiers line of inquiry, we seek to further explore the relationships among welfare regimes, extent of expansion of higher education, and related trade-offs. One can question whether trade-offs that imply choosing between two alternatives are unavoidable. The welfare regime typology offers three perspectives, one of which appears to transcend such a binary trade-off. For that purpose, the concept of a trilemma of subsidization, coverage, and public cost, as specified by Ansell (2008), may be more valid as it includes level of taxation as one of the dimensions of the public policy process. We revisit this in the conclusion and in light of our findings.
Research Design
To examine our analytical framework, we advance a few hypotheses. First, we expect to find systematic differences in participation in tertiary education
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among the different welfare regimes. We expect that conservative regimes constrain the expansion of higher education. The main reason is the strong preference embedded in the institutional arrangements of conservative regimes for preserving the established social order. Hence, educational opportunities are strongly linked to social estates.3 As a consequence, these regimes practise a strong kind of sponsored mobility (Turner, 1960). That is, the potential of the young generation is identified at a very early age and high potentials are encouraged to stay in the educational track that leads to the highest educational credentials; at the same time, the ambitions of the rest are discouraged and they are assigned to more modest opportunities (e.g., different tracks at lower secondary school and early vocational specialisation for the majority of the age group). We hypothesize that both liberal and social-democratic welfare regimes differ from the conservative approach in that they both welcome and encourage expansion at the tertiary level on the grounds of human capital enhancement and for equity considerations. Hence, we would expect a comparatively long period of comprehensive schooling, less (or even no) emphasis on vocational training at the secondary level, and, as a consequence, high entry and graduation rates at the tertiary level. However, we would also expect differences between the two regimes: Liberal regimes foster unrestricted human capital creation, they emphasize individual achievement and responsibility, and advancement to high levels of study based on meritocratic criteria (Turner, 1960). Education tends to be socially inclusive, through encouraging high aspirations and expectations (by, e.g., giving second and third chances) and by fostering social mobility. Encouragement of social mobility also serves to mitigate conflicts about social inequalities. There is very little (if any) social engineering and adjusting individual ambitions and societal needs. However, the strong emphasis on individual rights goes hand in hand with the requirement of large financial investments by individuals, unmatched by any other regime. Social-democratic regimes strive for a delicate balance between individual rights and the collective order. This collective order is not (as with the conservative regimes) the established hierarchy of social estates, but rather a notion of public welfare constructed by rational policy making. Hence, human capital formation is embedded within an overarching welfare structure and labour market policies (e.g., state economic and social planning, active labour-market policy, public responsibility for full employment, and the provision of high-quality jobs in the public sector). Higher levels of tertiary participation require higher levels of funding. Hence, we look at different indicators for funding of tertiary education. First, we hypothesize that liberal regimes spend a high percentage of both total public
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expenditures and gross domestic product (GDP) on tertiary education, whereas conservative regimes are low on both indicators. We hypothesize that socialdemocratic regimes will adopt a middle position. Second, we question the extent to which funding for tertiary education is provided by public or private sources. Based on the observation of a strong tendency toward de-commodification in both conservative and social-democratic regimes, we expect no or very little private contributions from students, whereas the market approach of liberal regimes would expect high individual contributions. Combining the two dimensions described leads us to advance the following matrix: Conservative regimes: low/medium public expenditures low/no tuition fees Social-democratic regimes: high public expenditures no tuition fees Liberal regimes: medium/high public expenditures high tuition fees Finally, we argue that the different attitudes towards tertiary expansion correspond with differences in student aid. Any society that seriously wants to foster human capital formation at the tertiary level must provide arrangements that help students from middle and low-income families to carry the cost of living during extended periods of educational study. However, a restrictive approach to tertiary expansion makes provision for student aid less urgent. Hence, we expect more complex schemes (including loans) that allow for a high percentage of enrolled students to benefit from aid of different kinds in liberal and social-democratic regimes. In conservative regimes we expect a less sophisticated approach to student financial aid and a lower proportion of beneficiaries. By turning our gaze to loans, we would expect differences between liberal and social-democratic regimes, with the former being much more market-like than the latter and hence leading to higher debt loads. Based on these observations we would expect to observe evidence for an unfettered human capital approach in liberal regimes and for a restricted human capital approach in conservative regimes. For social-democratic regimes, we would expect evidence for reconciling individual human capital ambitions with social welfare policies. We employ indicators published by the OECD to conduct this examination (OECD, 2005, 2006a, 2007, 2008a). First, we include four indicators of participation in tertiary education. These indicators collectively provide an indication of the degree of massification of tertiary educational system. In addition, because data are available to compare tertiary educational attainment levels by different age cohorts, we estimate the change in expansion of higher education over time by calculating the difference between attainment rates between the 2534 and 2564 years age cohorts. The indicators are as follows: entry rates into tertiary education; graduation rates from tertiary education;
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adult population aged 2534 years who have attained tertiary level A and B credentials; adult population aged 2564 years who have attained tertiary level A and B credentials.4 Second, we employ four pre-tertiary indicators as measures of prerequisites to tertiary education entry. These indicators are measures of the preconditions in place that determine the extent to which students can enter the next levels of education. For example, early tracking, as indicated by age of first selection into upper levels of education is a powerful instrument of social selection in that individuals are routed to institutions which, in turn, will largely determine their future life chances. The proportion of the age group engaged in general or vocational levels of education illustrates the proportion that will potentially enter university-level education, or conversely, an indicator of those destined for early vocational specialization. The likelihood of the students in vocational programs to enrol in tertiary education is smaller than those in general programs. The expectation to participate in International Standard Classification of Education (ISCED) level 5A or 6 is an indicator reflecting the ambitions of students shaped by the cultural climate and the expectations of society. The indicators we employ are as follows: first, age at which selection takes place; the proportion of age group in general programmes of upper secondary education5; the proportion of age group in vocational programmes of upper secondary education; the proportion of students expecting to complete ISCED level 5A or 6. Third, we examine the implications of these different welfare (and education) regimes on funding tertiary education, using the three indicators as specified separately below: public tertiary educational expenditures as a percentage of total public expenditures. This indicator signals the extent to which tertiary education policies have priority within the overall framework of government policies. public tertiary educational expenditures as a percentage of GDP. This indicator is a measure of the extent of public tertiary educational expenditures in relation to the wealth of a country. tertiary expenditures from public and private sources on educational institutions as a percentage of GDP.
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These are measures of (a) the extent of spending on tertiary education in relation to the wealth of a country, and (b) the proportion of public and private sources of these expenditures. Finally, we look at the different patterns of tuition and student aid. We use the following indicators: estimated average annual tuition fees charged by tertiary-type A public educational institutions: actual amounts in USD; proportion of students with loans; annual gross amount of loan available to each student: actual amount in USD; proportion of graduates with debt; average amount of debt at graduation in USD. We employ these data to systematically relate the various dimensions of higher education within a framework of the welfare arrangements of each country. We have selected 16 of the 18 countries used by Esping-Andersen (1990)6 and organized our analyses around three different types of welfare states: conservative welfare states (Austria, France, Germany, the Netherlands. Italy, Switzerland, and Belgium), liberal welfare states (Canada, USA, Australia, New Zealand, and UK), and social-democratic (universal) welfare states (Sweden, Denmark, Norway, and Finland). We use the data described above to demonstrate the logic of the relationships among participation in tertiary education, pre-tertiary prerequisites, educational funding, and levels of tuition and student financial aid. We recognize that extensions to Esping-Andersens original model have been proposed. For example, Mills and Blossfeld (2003) suggest a fivefold typology by adding two categories: the family-oriented regime of the Southern European countries (e.g., Italy and Spain) and the post-socialistic welfare regime to account for countries of the former socialist countries of Eastern Europe. Similarly, Castles (1993) has asserted that the liberal regime should be further divided to account for the role of labour movements in policy formation of some countries. However, Esping-Andersen (1999) has addressed these concerns and demonstrates that the explanatory benefits obtained by extending the number of categories is a matter of greater refinement, more nuance, and more precision (p. 92) but not of additional dimensionality. In this paper, we delimit our analysis to Esping-Andersens original three-regime framework. However, because we are focusing on tertiary education and as such are using a different set of indicators from those previously employed in other analyses, the results may suggest that an expansion of this framework is warranted. We will take up this issue in the discussion.
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Results
The most coherent and reliable database for international comparisons in education is that which contains the OECD indicators. However, this data set is far from perfect. Not all countries provided data for all indicators we wanted to include in this comparison. Also, some indicators are difficult to interpret. Despite its limitations, this database allows for an initial assessment of the soundness of our hypotheses. The data are summarized in Tables 1 to 4. Most of the data have been extracted from the 2008 OECD Education at a Glance (OECD, 2008a). Occasionally, we supplement missing data from this report with data available in the 2007 and 2006 reports (OECD, 2006a, 2007). In addition, when it is reasonable to do so, we supplement missing OECD indicators as specified above with indicators related to tuition and student financial assistance compiled by Usher (2005) and with data on tuition and student financial aid reported by Vossensteyn (2004). A more complete data profile permits a thorough examination of the types of student financial assistance provided by these countries. Data from sources other than the OECD 2008 report are identified in the tables. In Tables 1 to 4, we observe that there is wide variation within each of the three groups and a significant amount of overlap among the different regimes. Nonetheless, there is a correspondence between the indicators and welfare regimes. By examining enrolment and graduation patterns (Table 1), conservative regimes are clearly at the bottom with respect to expansion of tertiary education, with the Netherlands being a sort of outlier, whereas liberal regimes are at the top. Entry rates into tertiary-type A institutions vary between 35 and 58% in conservative regimes, between 59 and 76% in social-democratic regimes, and between 57 and 84% in liberal regimes. This pattern remains evident in graduation rates (tertiary-type A), with conservative regimes varying between 21 and 43%, social-democratic regimes between 41 and 48%, and liberal regimes between 36 and 59%. Graduation rates from tertiary-type B institutions range from 7 to 19% in conservative regimes, 0 to 10% in social-democratic regimes, and 10 to 24% in liberal regimes. The range of the adult population aged 2534 years of age holding tertiary-type A credentials extends from 1334% (conservative), 2940% (social-democratic), to 2935% (liberal). Comparable figures for tertiary-type B are 122%, 20%, and 526%, respectively. The long-term impact of educational expansion can be assessed by examining the proportion of the population aged 2564 years with tertiarylevel credentials. Again, the proportion with tertiary-type A credentials within the conservative countries is low (1028%) when compared with socialdemocratic (1931%) and liberal regimes (2235%). Also, those aged 2564 years holding tertiary-type B level credentials is low in both conservative and
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Table 1 Conservative DE NL IT CH BE CA US AUS NZ UK SE DK NO FI Liberal Social democratic
Indicators of participation in tertiary education in select OECD countriesa
AU
FR
Entry rates into tertiary education Tertiary-type A 40 39** Tertiary-type B 7 34** 35 13 58 n 55 m 38 15 35 36 m m 64 m 84 m 72 49 57 29 76 10 59 22 67 n
76 a
Graduation rates from tertiary education Tertiary-type A 22 27** 21 Tertiary-type B 7 19** 11 43 n 39 n 30 10 m m 37 m 36 10 59 m 52 24 39 15 41 5
45 10
43 1
48 0
Population aged 2534 years that has attained tertiary level credentials Tertiary-type A 13 24 15 34 17 23 19 Tertiary-type B 6 18 7 2 1 9 22 29 26 35 5 29 10 30 14 29 8
31 9
32 9
40 2
29 9
Population aged 2564 years with tertiary level credentials Tertiary-type A 10 16 15 28 12 Tertiary-type B 7 11 9 2 1 20 10 14 18 24 23 35 5 24 9
23 15
22 9
22 9
27 8
31 2
19 16
Change between 2534 and 3564 years population with tertiary level credentials Tertiary-type A +3 +8 0 +6 +5 +3 +5 +5 Tertiary-type B 1 7 2 0 0 1 +4 +3 0 0 0 2 +6 +5 +2 +9 +8
+5 1 +4
+7 1 +6
+7 1 +6
+9 0 +9
+5 +1 +6
+9 0 +9
+10 7 +3
Total
2 15
Data sources: OECD, 2008a and supplemented with OECD, 2005, 2006a, 2007 when necessary. n Magnitude is either negligible or zero. a Data are not applicable because the category does not apply. m Data are not available.
Table 2 Pre-tertiary indicators in select OECD countries Conservative AU 10 22 16 45 54 33 48 26 16 52 72 24 35 19 41 52 18 35 63 64 63 39 32 43 59 68 25 64 69 5 0 62 0** 42 15 57 10 41 12 33 14 40 15 36 12 31 16 95 16 100.0 16 38 16 100** 14a 58 16 40 60 26 FR DE NL IT CH BE CA US AUS NZ UK SE DK NO FI 16 35 65 52 Liberal Social democratic
Pre-tertiary indicators Earliest age of selection (years) Proportion in upper secondary general education Proportion in upper secondary vocational education Proportion expected to complete ISCED level 5A or 6
We use age 14 years for the UK based on information provided in these sites: in http://www.direct.gov.uk/en/EducationAndLearning/14To19/ Years10And11/DG_10013567; http://www.direct.gov.uk/en/EducationAndLearning/QualificationsExplained/DG_10039024; http://www.publications.parliament.uk/pa/cm200708/cmselect/cmchilsch/169/16905.htm.
Table 3 Educational expenditures in select OECD countries Conservative AU 3.0 1.5 1.2 1.1 1.4 0.8 1.5 2.2 2.4 3.0 1.6 3.3 2.6 1.3 FR DE NL IT CH BE CA 4.2 1.7 US 3.5 1.3 Liberal AUS 3.5** 1.1 NZ 4.8 1.5 UK 2.7 1.2 SE 3.5 1.9 Social democratic DK 4.5 2.4 NO 5.3* 2.3 FI 4.0 2.0
Educational expenditures Public tertiary educational expenditures as a percentage of total public expenditures Public tertiary educational expenditures as a percentage of GDP
Expenditure on educational institutions as a % of GDP Total 1.3 Public 1.2 Private 0.1
(public and private sources) 1.3 1.1 1.3 0.9 1.4 1.24 1.1 0.9 1.0 0.6 1.4 1.2 0.2 0.2 0.3 0.3 0.0 0.1
2.6 1.4 1.1
2.9 1.0 1.9
1.6 0.8 0.8
1.5 0.9 0.6
1.3 0.9 0.4
1.6 1.5 0.2
1.7 1.6 0.1
1.3 1.3 0.0
1.7 1.7 0.1 37
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Table 4
Conservative FR DE NL IT CH BE CA US AUS NZ UK SE DK Liberal Social democratic NO
Tuition and student financial aid indicators in tertiary education in select OECD countries

FI 330a 1,017 574 3,464 5,027 3,855 2,671 1,859 0 1,210b 1,505b 1,873c 0 0 0 0.2 2.2 2.4 0 0 0 0 0d 0c 65 19,400 50d 14,170d 67 10,838d 15.2 1 m 14.4 m 3,970 23.5 38 6,430 32.3 79 3,450 41.5 m 4,320 57 15,320 N 15.2 2.8 11.5 8.6 14.9 17.7 14.7 30.0 11.6 19.1 6.7 25.8 m 5,480 79 14,220 16.8 10.3 27.1 80 4,940 83 20,590 5.0 25.8 30.8 42 2,500 49 10,430 37.1 10.9 42.6 100 8,960 78b 20,290 n 16.6 16.6 26 2,710 39 6,160
AU
Tuition and student financial aid Estimated average annual tuition fees charged by tertiary-type A public educational institutions or government-dependent private institutions (USD)
837
Financial aid to students as a % of total public expenditure on tertiary education Student loans m a 5.1 15.5 n Scholarships/other 16.8 7.9 14.1 12.3 16.8 grants to households Total 16.8 7.9 19.1 27.7 16.8 Proportion of students with loans % 0 0 0 28 0 Annual gross amount of loan 0 0 0 5,730 0 available to each student (USD) Proportion of graduates with debt (%) 0 0 15d 15d 0 Average debt at graduation (USD) 0 0 6,973d 12,270 0
Franceaverage of the OECD range 160490. Data from Vossensteyn, 2004 in 2005 USD. c Switzerlanddiscrepancies are due to rounding errors. d Data from Usher and Cervenan, 2005 in 2005 USD.
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social-democratic regimes. In contrast, there is wide variation in countries within the liberal regime rubric. When compared with the 2564-years age group, only two conservative countries (France and Belgium) have experienced large increases in the proportion of 2534 year olds participating in tertiary education. Yet, the proportion of the 2534-years age group with tertiary-type A credentials in these countries remains relatively low. The US has experienced zero growth. However, the 2564-years age group of this country is the most educated when compared with the same age group in all the countries we have included in the analysis. In other words, post-secondary expansion occurred much earlier in the US (see OECD, 2008a, Chart A1.3, 32). Goldin and Katz (2008) have demonstrated that the US was the pioneer of tertiary expansion, but since the 1980s has lost momentum. These systematic differences observed at the tertiary level could be anticipated and indeed are evident at earlier stages of educational careers. Table 2 demonstrates that selection into different school tracks commences much earlier in conservative regimes than in liberal and social-democratic regimes. Also, in conservative regimes, only 1841% of students at age 15 years expect to complete ISCED level 5A or 6, compared with 2652% in socialdemocratic regimes and 3264% in liberal regimes. However, the proportion of students attending upper secondary general studies varies considerably both within and among regimes at 2257% (conservative), 3552% (socialdemocratic), and 38100%7 (liberal regimes). Similarly, the proportion of students enrolled in upper secondary vocational education varies across regimes, but is overall considerably lower in liberal regimes. These systematic differences in indicators that point to different levels of tertiary expansion and its preconditions are consistent with the differences at the level of funding. Consistent with enrolment and graduation rates, Table 3 reveals the range of expenditures on tertiary education. The pattern is one of low contributions in conservative regimes and higher contributions in both liberal and social-democratic regimes. For example, public tertiary educational expenditure as a percentage of total public expenditure is low in conservative regimes (1.63.3%), moderate in liberal regimes (2.74.8%) and high in socialdemocratic welfare regimes (3.55.3%). Public tertiary educational expenditures as a percentage of GDP mirror these findings at 0.81.5% in conservative regimes, 1.11.7 in liberal regimes and 1.92.4% in social-democratic welfare regimes. In terms of total expenditure on educational institutions as a percentage of GDP at the tertiary level, liberal regimes are highest (1.32.9%), followed by social-democratic regimes (1.31.7), and conservative regimes (0.91.4%). If we differentiate between private and public expenditures, it becomes evident that the exceptionally high level of tertiary spending in some liberal countries (mainly North America) is possible only through very high private contributions. Private expenditures on tertiary education as a
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proportion of GDP are moderate in conservative regimes (0.10.3) and even lower in social-democratic regimes (0.10.2). In contrast, there is wide variation in liberal regime countries (0.41.9). However, it is noteworthy that UK with the lowest percentage exceeds event the highest percentage from any other regime. The US is exceptional in that private expenditures exceed public expenditures. The most important facet of private tertiary expenditures is tuition fees. Average annual tuition fees in the liberal regimes vary between 1,859 and 5,027 USD. In conservative regimes they vary between 330 and 1,873 USD. Socialdemocratic regimes charge no fees at all (Table 4). Respectively, the relatively high level of spending in social-democratic regimes is reflected in high public expenditures on tertiary education as a percentage of GDP (see paragraph above), whereas in conservative and liberal regimes the range is similar. These findings support our funding matrix hypothesis; that is, conservative regimes have low/medium public expenditures in combination with low/no tuition fees. Social-democratic regimes have high public expenditures and no tuition fees. Liberal regimes combine low/medium public expenditures with high tuition fees. Conservative and social-democratic regimes share a strong tendency to de-commodification, hence no/low tuition fees. Social-democratic and liberal regimes share a commitment to expansion of tertiary education; hence, they must raise not only sufficient resources but also the sources for funding tertiary education differ. The commitment to tertiary expansion requires sufficient means for student aid. According to the OECD (2008a), a key question in many OECD countries is whether financial subsidies for households should primarily be provided in the form of grants or loans. y Advocates of student loans argue that money spent on loans goes further: if the amount spent on grants were used to guarantee or subsidise loans instead, more aid would be available to students and overall access would increase. Loans also shift some of the cost of education to those who benefit most from educational investment. Opponents of loans argue that student loans are less effective than grants in encouraging lowincome students to pursue their education. (p. 275) OECD data reveal a clear relationship between the availability of student loans on the one hand and the amount of public financial aid to students on the other hand. Of all the countries covered in this paper, only those with loan schemes exceed the OECD average of public student aid as a percentage of total public expenditures on tertiary education (Table 4). Owing to a few outliers, variation does exist within all welfare regimes; however, a clear pattern can be identified. In the conservative regimes public student aid as a percentage of total public expenditures on tertiary education ranges from 2.4 to 27.7%. Only the
41
Netherlands (substantively) and Germany (marginally) exceed the OECD average of 17.6%. These are the only countries within the conservative family with public loan schemes available. In the liberal countries, student aid ranges between 14.4 and 32.3% of total public expenditures. In all liberal countries public loan schemes are available; all but Canada spend more than the OECD average. The social-democratic regimes spend the highest percentage of their tertiary expenditures on student aid (16.642.6%). Finland, where loans only play a marginal role, is an outlier; hence, it is slightly below the OECD average. We can conclude that loans predominate in those countries, which are committed to tertiary expansion. As no country can afford to support a large number of students only by non-repayable stipends and scholarships (a pattern of support that was dominant in an era of elite higher education when the number of students who applied for support was small), social-democratic and liberal regimes have designed a wide range of student loan schemes. Conversely, in conservative regimes where expansion has remained low, loans play either a less important or no role at all. As expected, over 50% of students in liberal regimes graduate with student debt and the average amount of debt at graduation is high (i.e., greater than 14,000 USD). However, contrary to our hypotheses, a high proportion of students from social-democratic countries also have high debt loads and the average amount of student debt is high. Finland is the exception. By combining tuition fees and student aid data, the OECD has identified four patterns that strongly align with the welfare regime typology. We can summarize the OECD findings as follows8: The first pattern defined by no or low tuition fees but quite generous student support systems (OECD, 2008a, 272) includes the Nordic countries. The second pattern that is defined by high level of tuition fees and well developed student support systems (p. 273) and includes the liberal countries and as an outlier the Netherlands. Compared with the liberal countries, tuition fees in the Netherlands are moderate. Finally, the other conservative countries constitute a pattern that is defined as low level of tuition fees and less developed student support systems (p. 274).
Correspondence Analysis
Thus far, the analyses have demonstrated that there is reason to believe that the three welfare regimes differ in terms of participation in tertiary education, pretertiary prerequisites, educational funding, and levels of tuition and levels of borrowing. To further illuminate and confirm these relationships, we employ the analytic technique of correspondence analysis (CA). CA is a multivariate descriptive data technique that summarizes information to provide a visual
42
representation of data distribution in a two-dimensional map (Greenacre, 2007). As Greenacre (1990) explains, CA is an exploratory statistical technique which displays the rows and columns of a rectangular data matrix as points in a scatterplot (p. 1). It is similar to principal components analysis in that it is a method for decomposing the overall inertia along principal axes, but is applied to cross tabulations and hence allows for the analysis of categorical data. In CA, the patterns of association portrayed in larger data sets (and contained in the rectangular data matrix) are examined through a graphic description of tabular data, where each row and each column is depicted as a point. For an introduction to CA, see Greenacre (2007). Data are organized into columns and related rows. The columns in this analysis are the 16 countries. Rows are comprised of 17 indicators selected to best represent the four categories identified in Tables 1 to 4. Our choice of indicators was also constrained by missing data for some countries. Only indicators with complete data for each country were employed in the correspondence analysis. We employ correspondence analysis to determine the combined role of four tertiary participation indicators, four pre-tertiary indicators, four funding indicators, and four tuition and student financial aid in relation to country. These indicators and their corresponding labels are listed in the legend. In other words, we are interested in measuring the correspondence between the columns (countries) and rows (educational indicators). CA is versatile in that through the transformation of continuous data into ranks,9 we are able to conduct this multivariate analysis using indicators contained in the OECD reports. Each indicator was recoded into a rank ranging from 0 (lowest) to 15 (highest) to create a positive pole; this figure is then subtracted from the maximum value of the positive pole (in all instances, 15) to create a negative pole. In doing so, we have created a set of complementary scales which represent the number of scaled points above and below the actual value (Greenacre, 2007). According to Greenacre, since the ranks are analysed and not the original values, the analysis [is] robust with respect to outliers and can be called a nonparametric CA of the data (p. 184). We used XLSTAT to compute the w2 coordinates of profile points and the statistical tests of the analysis. The data are displayed in a symmetric two-dimensional map, which reveal the relative positions of row and column profiles. The challenge in this analysis is to interpret the principal axes by identifying the latent (hidden) variables that explain the amount of the total inertia along each axis. w2 distances separate the row and column profiles and are used to compute inertia (or variance), which measures the dispersion of these profiles in a multidimensional space. The CA map corresponds to a lower-dimensional subspace defined by a pair of
43
principal axes and displays the location of profile points as close as possible to the true set of profiles represented in the multi-dimensional space. The correspondence analysis map in Figure 1 positions the points corresponding to the 16 column profiles assigned to the country categories in relation to the 17 row profiles. This map displays the projection of points in the subspace defined by the first two principal axes that account for the largest amount of the overall inertia (37%). By examining the horizontal axis, with the exception of Finland, the groups of countries we have identified as belonging to the conservative regime, are
0.6
F_EGDPtertpublic+
F_EGDPtertprivFA_tuitionFI DK NO F_TPE_tert+ PT_upsecvoc+ PT_ISCED5a6SE
0.2
PT_upscgen-
CH
F_EGDPtert+ PT_agesel+ P_25_34trtcrdA+ P_25_64_trtcrdB+ P_25_34_trtcrdB+ P_25_64_trtcrdA+ FA_propdebt+ FA_averdebt+ FA_grants+ FA_grantsFA_loans+ CA FR NL P_25_34_trtcrdBP_25_64_trtcrdBNZ PT_upscgen+ AUS
BE AU
F2 (17.63%)
FA_loans-
FA_averdebtFA_propdebtP_25_64_trtcrdA-
P_25_34trtcrdA-
-0.2
PT_ageselF_EGDPtertDE UK
PT_ISCED5a6+ PT_upsecvocUS
F_TPEtert-
FA_tuition+ F_EGDPtertpriv+ IT
F_EGDPtertpublic-
-0.6 -8.0
-4.0
0 F1 (39.35 %)
0.4
0.8
Figure 1. Correspondence analysis of countries and tertiary, pre-tertiary, educational expenditure, and tuition and student financial-aid indicators.
44
located to the left and are opposed to all other countries to the right side of the map. This axis accounts for 39% of the average total inertia. The column profiles that contribute the most to this axis correspond to Austria on the left and the USA on the right; these two extremes define the axis. Also, the profiles of Belgium and Italy are well aligned along the first axis toward Austria and New Zealand and Canada are well-aligned on the right with the USA. Sweden, Denmark, Norway, and Australia are aligned along the first axis, but less strongly so, toward the USA. Switzerland and France are similarly aligned toward Austria on the left. Finland, the Netherlands, and the UK contribute the least to the first axis and hence remain outliers of sorts. The placement of row profiles reveal that average amount of student debt at graduation, the proportion of the 2564-years age population with tertiary-type A credentials, the proportion of graduates with debt, and the proportion of the 2534-years age population with tertiary-type A credentials are well matched along the horizontal axis. The profile is also associated with the following variables: the proportion of students in upper secondary general education, age of selection, total loans to students as percentage of total public tertiary expenditure, and public educational expenditure on tertiary education as a percentage of (a) total public expenditures and (b) GDP. These variables also contribute most to the axis. We interpret this axis as an educational expansion dimension with the less expansion row profiles matching with the country column profiles to the left and more expansion row profiles matching well with the country column profiles to the right. Also included in this expansion dimension are pre-tertiary indicators, which determine whether young people have the prerequisites to engage in tertiary study. Finland is oriented closer to the left because of a relatively low proportion of the age 2534 and 2565 years population with tertiary-level credentials and low student debt. Conversely, this proportion is high in the Netherlands. Also, in the Netherlands financial aid to students as a percentage of total public expenditure on tertiary education does not fit the profile of a conservative regime country. As such, it is an outlier on this dimension. The vertical axis accounts for 18% of the total inertia, and mainly contrasts the column profile that corresponds to Finland (up) with the profile corresponding to Italy (down). Three row profiles associated with (a) public and (b) private expenditures on tertiary institutions as a percentage of GDP, and annual average tuition fees charged by tertiary-type A institutions contribute the most to this axis. Hence, the second dimension is a tertiaryfunding dimension. Finland and Italy represent the two extremes of the vertical axis. In terms of public expenditures on tertiary institutions as a percentage of GDP, Italy ranks lowest of all countries (0.6%) and Finland highest (1.7%). Conversely, Italy (0.3%) (along with the Netherlands) ranks highest of all non-liberal countries
45
in terms of private expenditures on tertiary institutions as a percentage of GDP, whereas Finland ranks among the lowest at 0.1%. Canada is drawn closer to the upper part of the map on the vertical dimension because of relatively high public expenditures on tertiary institutions as a percentage of GDP (at 1.4%), which aligns more closely with the Nordic countries. The Netherlands is an outlier because of relatively higher private expenditures on tertiary institutions as a percentage of GDP and higher tuition fees. In summary, this analysis demonstrates three clear clusters of countries that align with Esping-Andersens welfare typology. And they are indeed significantly associated with indicators of tertiary participation and graduation, pre-tertiary indicators, and funding indicators (w2547.87, d.f.495, and po0.0001).
Discussion
Our analyses demonstrate a relationship between welfare regimes and patterns of education policy. In addition, our findings support the trade-off hypothesis that claims that there is a conflict of goals in either providing tertiary educational opportunities or investing in social insurance programs. The results reveal that countries that lean toward the goal of equality of condition invest less than those countries that strive for either enhancing equality of opportunity or enhancing both equality of opportunity and condition. We continue by highlighting the advantages and disadvantages of each regime. Welfare regimes and higher education Countries that adhere to the liberal welfare approach minimize their efforts to establish equitable living conditions, but they apply a strong human-capital philosophy that involves the highest resources spent on higher education and the highest participation rates among the three welfare regimes. Clearly, this arrangement is in accordance with the basic requirements of knowledge-based economies to increase the stock of human capital. One problem of this pattern relates to those individuals who do not excel academically and, as a consequence, cannot benefit from the comparatively generous opportunities in postsecondary education. Individuals who drop out of high school or who do not continue their education at the tertiary level for other reasons seem to fall short of the minimal requirements expected for stable, well-paid jobs. Although the percentage of the age cohort with no tertiary education is smaller in liberal regimes than in any other regime, it still encompasses a significant proportion of the population. Because of the relative lack of vocational skill provision and social safety net policies, the status and the labour market
46
chances of this group is more precarious than those in comparable groups in the other welfare regimes. This is re-inforced by the general tendency of the liberal welfare regime to tolerate high levels of inequality of living conditions. Another issue of concern is the high amount of debt incurred by a large proportion of graduates. Under a liberal human capital approach with low levels of de-commodification, individuals are expected to contribute to the direct cost of their education. In most liberal countries, cost of higher education grew much faster than median family income during the last two decades. Hence, debt levels have escalated (The National Center for Public Policy and Higher Education, 2008). To summarize, liberal regimes provide tremendous opportunities for individuals who comply with the requirements of knowledge society (e.g., minimally accepted level of academic ability, ambition to succeed, readiness to embrace lifelong learning). Those who fail to meet these requirements carry a heavy burden. The Economic Council of Canada has emphasized this weakness of a liberal market model: A drawback of this excessive emphasis on individualism is that certain people may lack the resources or influence to compete equally in the learning system and the labour market. This weakness can be tempered by the high level of accessibility of the system, which opens up a wide range of opportunities to everyone. However, individuals are largely left alone to confront the world that surrounds them. (Economic Council of Canada, 1992, 46) Conservative welfare regimes, by contrast, provide better conditions for those who will never attain tertiary level credentials. The attitudes in these countries are shaped by remainders of an ideology that assigns individuals to their proper place in society. Educational streaming is a powerful mechanism of social reproduction. It is taken for granted that students from different social/educational backgrounds have different educational and career trajectories, but because of the de-commodified welfare provisions of these regimes the lower social estates still enjoy comparatively high standards of living. The extensive system of vocational training in most conservative countries plays an important role in providing an alternative training route for academic low achievers. Graduates of the apprenticeship system enjoy a higher social status and better labour market chances than do individuals in the liberal welfare regimes without tertiary education. This characteristic of conservative regimes contributes to the comparatively high level of equitable living conditions, but it comes at a high price. The other side of the coin is an education system that constrains expansion of learning at the tertiary level and discourages the ambitions of students who struggle to meet the requirements of elite secondary schools with selection mechanisms that start as early as age 10
47
years. As Lehmann (2005) points out, this system has been criticized as outdated and archaic [and] narrowly skills-based which has not yet addressed the more broadly defined demands of new work places (p. 119). The consequence of maintaining patterns of sponsored mobility (Turner, 1960) even at the fringe of a knowledge based economy is that that conservative welfare regimes lag in expanding their systems of postsecondary education, whereas most other parts of the world move ahead. Advocates of extensive vocational training at the secondary level emphasize the danger of overeducation and highlight the need for labour market planning. In the past, this strategy was relatively successful. The lack of tertiary graduates could easily be compensated by an ample supply of graduates of vocational training. Two recent trends could endanger this pattern. First, the expansion of a knowledgebased economy depends much more on a growing supply of tertiary graduates (Allmendinger and Leibfried, 2003) to assume jobs in a world increasingly defined as one of liquid modernity (Bauman, 2000). This is in contrast to solid modernity characterized by Fordist type regimes of past decades. Second, globalization of labour markets will advance the standardization of, and need for, education certificates. It is questionable if the conservative regimes will be successful in maintaining their niche.
Trade-offs and higher education Our findings suggest that the trade-off hypothesis is confirmed through a comparison of liberal and conservative welfare regimes. However, it appears that social-democratic welfare regimes seem to avoid some of the trade-offs faced by liberal and conservative countries. The socially embedded human capital approach of these countries allows for expansion of higher education without neglecting those parts of the age cohort who are unable or unwilling to make use of that opportunity. Unlike the laissez-faire approach of liberal regimes, there is a certain degree of social engineering in balancing and adjusting supply and demand of higher learning opportunities by fostering the development of both general and specific skills. For example, all Nordic countries limit their seats for research universities through Numerus Clausus.10 The commitment to de-commodification strategies results in resistance toward introducing tuition fees. Hence, those who are talented do not need to invest their own resources for the direct cost of their higher education. Only countries within social-democratic welfare regimes maintain a no fee philosophy that spread globally during the late 1960s but were subsequently reversed in most countries. Although there are no fees, the high level of public spending results in significantly higher total expenditures for tertiary education (as a percentage of GDP) than in all conservative regimes, where in most cases public
48
expenditures are supplemented by admittedly low tuition fees. This pattern, however, depends on belief systems that have evolved over many decades, encompassing not only egalitarian values but also a high trust in public administration (and hence an unparalleled readiness to pay high taxes). The question remains to what extent this Nordic exceptionalism can be maintained in an area of declining national sovereignty. The global trend in the last three decades has been to emphasize the benefits of markets and to reduce the tax base of governments. The Nordic countries have not been excluded from this trend. As in most countries, public expenditures as a proportion of GDP have also dropped in the social-democratic regimes (OECD, 2008b). Hence, the policy response to the subsidization, coverage, and public cost trilemma, as specified by Ansell (2008) may change. Another issue of concern is the amount of debt carried by graduates, which is similar to levels held by graduates in liberal regimes, hence not confirming our hypothesis in this regard. Such debt loads are somewhat surprising, given that university students in social-democratic regimes do not pay fees. However, the generous conditions for student loans allow students in these countries a high standard of living, for example living independently from their parents and not being obligated to work while completing their studies. The issue of loans11 reflects the different attitudes of the three welfare regimes in a nutshell. Conservative regimes have either no loan schemes for students or comparatively restrictive conditions. As a consequence, a high proportion of students work while studying to cover their costs of living. For example, Euro student data (Orr, 2008, 119) reveal that the employment rate of all students during the academic term is 4675%12 in conservative regimes compared to 4356% in social-democratic regimes (119). The need to selffinance results in less time available for students to devote to their studies (Orr, 2008, 121). Both liberal and social-democratic regimes foster their expansionist education strategies by providing loans to students. They differ, however, in the prerequisites for receiving loans and the restrictions for which students may make use of the money. In liberal regimes, students need loans to cover the fees for tuition and living expenses. In social-democratic regimes, students need loans only for the latter.
Outliers Although we emphasize the relationship between educational policies and welfare regimes, we recognize that additional (independent) factors influence education policy, and result in identified outliers. For example, the welfare regime typology does not explain within regime differences such as, for example, educational expansion between North America and the UK. North
49
America, and in particular the US, has been a pioneer in expansion of upper secondary and tertiary education (Goldin and Katz, 2008). The UK was a laggard (not only compared with the US, but until the 1980s also with most European countries). The UK has a well-entrenched class system, and a historically stronger tradition of sorting students (e.g., into O and A levels). Also in the UK, a large proportion of the school population historically exited school at age 15 years or engaged in apprenticeships; as such, it was far slower to expand from an elite to mass higher-education system. Likewise, the Netherlands13 differs in many respects from the patterns observed in other conservative regimes. Nor does Finland fit neatly into the social-democratic framework. We believe that these outliers do not invalidate our thesis of a systematic relationship between welfare regimes and patterns of education policy. Further investigation of these questions would not only contribute to a better understanding of this relationship, but of the welfare typology itself. The addition of countries from southern Europe and post-socialistic regimes in future analyses will further strengthen the analytical power of this theory.
Conclusion
The focus of this paper has been on the refinement of an analytical framework for cross-national comparisons. We argue that combining the analysis of higher education and welfare policies furthers our understandings of national differences in both areas. Our focus is not on making normative judgements about the superiority or the deficiencies of the various national clusters. However, it is an intriguing question to ask whether some regimes are better equipped than others for the challenges of a knowledge-based economy. We conclude with a general observation about policy change. To a certain degree, each country is open to new dynamics; however, it is also bound by different historical forces and follows distinct trajectories from which it cannot easily or quickly diverge. Policy makers who intend to change this direction should be aware of this inertia. Adopting policy strategies from other contexts requires careful consideration of the underlying societal structures and traditions. The first step for governmental and educational policy makers is to recognize that their respective countries fit into a particular regime framework. Second, they need to assess the goals for higher education and the extent to which these goals are in line with current path dependencies. Third, they need to take the courageous step of aligning higher education policies with desired goals and outcomes which may require stepping beyond the bounds of a given welfare regime framework.
50
Notes
1 Other authors have demonstrated that systematic differences among welfare regimes exist at the secondary level. Allmendinger and Leibfried (2003) have identified four worlds of competence production on the basis of Programme for International Student Assessment data (PISA), three of which align with Esping-Andersens welfare typology. Social democratic regimes combine high levels with low variation of these competences. Liberal regimes have both high levels and high variation of competences. Conservative regimes combine low levels with high variation of competences. The three worlds of human capital production described by Iversen and Stephens (2008) match the three regimes that we employ in this article. However, Iversen and Stephens focus on skill formation primarily at the secondary level. 2 We use the terms higher education and tertiary education interchangeably. 3 The concept of social estates refers to the broad divisions of society throughout the history of Europe. Originally the concept distinguished nobility, clergy, and commons. In contemporary society it refers to the almost impermeable social divisions between upper, middle, and lower classes in some countries (Cox, 1945), which Allmendinger and Leibfried (2003) describe as adherence to a traditional feudal notion of class (p. 63). 4 Tertiary-type A credentials are earned at institutions defined as largely theory-based and are designed to provide sufficient qualifications for entry into advanced research programmes and professions with high skill requirements (OECD, 2006b). Tertiary-type B credentials are earned at institutions that are typically shorter than those of tertiary-type A and focus on practical, technical or occupational skills for direct entry in the labour market (p. 15). 5 The proportion of the age group enrolled in general or vocational education is a proportion of total enrolments in upper secondary education. These two figures do not necessarily add up to 100% because in some countries students are enrolled in pre-vocational programs. 6 Japan was excluded from the analysis because the traditions of Asian countries deserve an analysis in their own right. As rapid social and economic changes in Ireland may distort the analysis, we have not included it. 7 See footnote 3. 8 One pattern (Japan) is not relevant in our context. 9 Owing to the nature of the data, it was necessary to use a ranking procedure. We follow the tenets of Greenacre (2007) to form the ranks. Because of the small sample size and the categorical nature of the variables, it is not possible to conduct either factor or cluster analyses. 10 A Numerus Clausus approach specifies restrictions to admissions in those countries where certification earned at the secondary level entitle individuals to tertiary entry. 11 We consider only state supported loans, not other types of loans such as private loans with banks. 12 Italy, at 39%, is an outlier among the conservative countries. 13 Goodin et al. (1999) locate the Netherlands in the social democratic regime category, which indicates that this country is not easy to label.
References
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52 OECD. (2008b) Revenue Statistics 19652007, Paris: OECD. OECD. (2008c) Tertiary Education for the Knowledge Society, Paris: OECD. Orr, D. (2008) Social and Economic Conditions of Student Life in Europe, Bielefeld: Bertelsmann. Pechar, H. and Andres, L. (2010) Education and skill formation in secondary and tertiary education: A comparison of welfare and production regimes, Paper presented at the annual meeting of the Consortium of Higher Educational Research Conference, Oslo, Norway, June 1012. Starke, P. (2006) The politics of welfare state retrenchment: A literature review, Social Policy and Administration 40(1): 104120. The National Center for Public Policy and Higher Education. (2008) Measuring Up 2008. The National Report Card on Higher Education, San Jose, CA: The National Center for Public Policy and Higher Education. Turner, R. (1960) Sponsored and contest mobility and the school system, American Sociological Review 25(6): 855867. Usher, A. (2005) Global Debt Patterns: An International Comparison of Student Loan Burdens and Repayment Conditions, Toronto, ON: Educational Policy Institute. Vossensteyn, H. (2004) Student Financial Support: An Inventory in 24 Countries, The Netherlands: CHEPS.

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Higher Education Policy, 2011, 24, (25 52) r 2011 International Association of Universities 0952-8733/11 www.palgrave-journals.

Higher-Education Policies and Welfare Regimes: International Comparative Perspectives

The Trade-Off Argument

Table 1 Conservative DE NL IT CH BE CA US AUS NZ UK SE DK NO FI Liberal Social democratic

Indicators of participation in tertiary education in select OECD countriesa

Higher Education Policy 2011 24

Entry rates into tertiary education Tertiary-type A 40 39 Tertiary-type B 7 34 35 13 58 n 55 m 38 15 35 36 m m 64 m 84 m 72 49 57 29 76 10 59 22 67 n

Graduation rates from tertiary education Tertiary-type A 22 27 21 Tertiary-type B 7 19 11 43 n 39 n 30 10 m m 37 m 36 10 59 m 52 24 39 15 41 5

2.6 1.4 1.1

2.9 1.0 1.9

1.6 0.8 0.8

1.5 0.9 0.6

1.3 0.9 0.4

1.6 1.5 0.2

1.7 1.6 0.1

1.3 1.3 0.0

1.7 1.7 0.1 37

Higher Education Policy 2011 24

Higher Education Policy 2011 24

F_EGDPtertprivFA_tuitionFI DK NO F_TPE_tert+ PT_upsecvoc+ PT_ISCED5a6SE

Higher Education Policy 2011 24

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