High Skills for High Tech: Higher Education as Industrial Policy

Abstract

How do states create the skills needed for high technology economic activities that hold an increasingly important role in contemporary societies? Examining economic statecraft in the higher education sector, this article shows that the policies employed by governments to expand the supply of high skills vary depending on their economies' most advanced sectors. Governments who seek to meet the demand of the high-end services sectors pursue a strategy of “open-ended” higher education expansion. “Targeted” expansion of higher education, instead, is the preferred option for governments in countries characterized by large advanced manufacturing sectors. The latter strategy, however, is hampered by the presence of a partly private higher education system since the ability of governments to successfully pursue their strategies is mediated by the existing institutional framework in the realm of higher education policy. Empirically, the argument finds strong support through three country case studies—Germany, South Korea, and the United Kingdom—that allow to simultaneously leverage a most-similar and most-different research design.