The Political Economy of Higher Education Finance: The Politics of Tuition Fees and Subsidies in OECD Countries, 1945–2015 by Julian Garritzmann

In The Political Economy of Higher Education Finance: the Politics of Tuition Fees and Subsidies in OECD Countries, 1945-2015, Julian L. Garritzmann employs a mixed methods approach to explain the resilience of different tuition fee and subsidy systems across time. This overview of tuition and subsidy regimes is important because of the dearth in empirical data around what drives tuition fees across the OECD, as well as what accounts for the stickiness of subsidies even when governments are led by rightist political parties that traditionally espouse greater privatization and deregulation. What accounts for the difference in tuition fees and subsidies across OECD countries?

Garritzmann makes an excellent contribution to our understanding of the relationship between higher education tuition fee regimes and variations in the political economies of OECD countries. The “Four Worlds of Student Finance” describes four distinct tuition-subsidy regimes across OECD countries: high tuition-high subsidy regimes characteristic of market economies (e.g., the United States); high tuition-low subsidy regimes in which access to higher education is historically restricted to the elite (e.g., Japan); low tuition-high subsidy regimes characteristic of social democratic governments (e.g., Finland); and low tuition-low subsidy regimes in which subsidies are corporate driven or tied to non-state elements (e.g., Germany).

The first major contribution of this book to the expanding education policy literature is the mapping of tuition-subsidy regimes onto existing models of welfare capitalism (Esping-Andersen 1990). Garritzmann confirms a positive (and unsurprising) correlation between education spending on public institutions and tertiary enrolment, particularly for low income families. Garritzmann then introduces a time-sensitive meso-level partisan theory model to account for why particular kinds of tuition-subsidy regimes exist in different political contexts. The question is central to Garritzmann’s book: why do some countries (and groups of countries) keep tuition fees low while others keep them consistently high, irrespective of changes in governing parties? This is an important contribution to the existing literature on higher education policy in OECD countries because it helps to account for the stickiness of some policies even when new parties come to office.

The detailed comparative country case studies, in which Garritzmann traces the development of tuition-subsidy regimes in Finland, Germany, the United States, and Japan, is the focus of Chapter 3. These cases are exemplary of the Four Worlds of Student Finance and, in the tradition of Historical institutionalist literature, Garritzmann shows how each world of student finance evolved along policy pathways particular to that national context beginning in the post-WWII environment. Garritzmann develops and applies his “Time-Sensitive Partisan Theory” to reveal the mechanisms of “path dependency” (Pierson 2000) by demonstrating how key pieces of legislation by governing parties lock in policy decisions that make policy reversal politically unappealing. Detailed case studies offer a rich and convincing explanation for why policies endure even when regimes change; at the same time, these cases also seem to be rather unique national experiences that make robust comparison, even among OECD countries, methodologically challenging. The US G.I. Bill, which shaped American post-war education policy by providing returning war veterans with massive education subsidies, was a distinctly American experience and not replicable in other high-tuition/high-subsidy cases.

The data from these country cases supports the theory that tuition fee and subsidy systems are shaped by people and by politics. These cases also demonstrate “politics in action” around education spending over time. Subsidies and, to a lesser extent, tuition fees, are responsive to public opinion. Chapter 4 is exemplary of the mixed methods approach that lends such a rich contribution to the emerging literature on higher education finance. Here, Garritzmann offers a detailed case study of Great Britain, using content analysis of British manifestos dating to the 1960s to show how the Liberal, Labour, and the Conservative parties differ on education spending. This analysis confirms that parties have differing positions on education spending, but also helps explain the feedback effects from public opinion that promote a type of political path dependency in higher education finance.

In order to account for more nuanced feedback effects, and to give greater context into the policy stickiness of tuition fee and subsidy regimes, Garritzmann brings his analysis from the institutional (party) level (chapters 3-5) to the individual/aggregate level (chapter 6). The author here seeks to “probe micro-level implications of my Time-Sensitive Partisan Theory” (268) as a way of explaining party positions over time. To accomplish this, Garritzmann looks at the relationship between public opinion, party position, and higher education finance policy over time in 22 countries. Drawing on International Social Survey Program (ISSP) responses in Role of Government surveys, Garritzmann illustrates how particular demographics (students and parents) and political beliefs (left- vs right-leaning political views) are key to understanding the resilience of tuition fee and subsidy regimes in the Four Worlds of Student Finance. While Garritzmann shows that public support is greater in systems with generous subsidies, what accounts for the low levels of public support in low subsidy systems? (One also wonders how public support can be mobilized in less generous subsidy systems). This is an interesting theoretical question because it implies that positive feedback effects described by Garritzmann may in fact be shaped by pre-existing subsidy systems.

Julian Garritzmann’s Time-Sensitive Partisan Theory reveals that tuition fee and subsidy systems are shaped at their core by social forces that have evolved into various post-WWII political and economic systems. Country cases in public policy literature may be classified into “varieties of capitalism,” “four worlds of welfare capitalism,” or “four worlds of student finance;” Garritzmann connects the dots by showing how these clusters vary in political and economic support for subsidies. In groups of countries where public opinion supports higher education subsidies, policy change or policy reversal is politically costly enough to be “locked in” (Pierson 2000). Systems with lower (or non-existent) tuition fees and generous subsides for higher education exist in societies where people have traditionally believed that government has a role in providing equity, equality, and access to higher education (among other public goods). In his well-researched typology, Garritzmann contrasts this ideal-type system with another: the Anglo-Saxon high tuition-high subsidy system, described as an inherently more meritocratic and competitive system. There is some danger in categorizing a political economy of higher education finance according to what a sampled group of people believe is the government’s role in making higher education more accessible and less financially prohibitive. A political economy extends deep into the political structures undergirding higher education governance as well as the very basic question of who deserves access to higher education?

The book presents a convincing and well-researched case for the stickiness of higher education finance systems despite—and because of—variations in political regimes across the OECD. In some ways the book fails to consider a political economy approach that also acknowledges the social and political forces that structure power relations in (OECD) higher education finance. And like much of the data driven theory in higher education policy literature, too much emphasis is placed on rational choice institutionalism as a historical explanation of modern tuition fee and subsidy regimes; there is comparatively less emphasis on the kind of sociological approaches that may, in fact, anticipate the future of higher education finance in the OECD. This suggests an evolving political economy rather one that is fixed to any “world” of student finance. For example, what do pressures around attaining quality and equity in higher education imply for future tuition and subsidy regimes across the OECD? University faculties across many OECD countries, but especially in the Anglo Saxon high tuition-high subsidy systems, are under enormous pressure to balance budgets, become more entrepreneurial, and ultimately maintain a benchmark in teaching and learning (benchmarks that are established and orchestrated in part by the OECD through PISA and AHELO). Novel shifts in university governance, in university budget models, and in strategic internationalization have implications for tuition fees and the broadening, shrinking, and the complete reshaping of subsidies. As faculties seek to internationalize (and balance budgets) by attracting high numbers of international students, tuition fees become automatically linked to international engagement and therefore politicized in ways that may unlock path dependency. Future research will build on Garritzmann’s typology of the worlds of higher education finance to probe deeper into how tuition fee and subsidy systems are undergoing transformation under conditions of internationalization. A research agenda in this important policy area, building upon Garritzmann’s work, will pull together theories and approaches from public policy literature and from international relations theory and offer a rich addition to the literature.


Reviewed by Scott Smith, University of British Columbia

The Political Economy of Higher Education Finance: The Politics of Tuition Fees and Subsidies in OECD Countries, 1945–201
By Julian Garritzmann
Publisher: Palgrave MacMillan
Hardcover / 319 pages / 2016
ISBN: 978-3-319-29913-6

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Published on June 4, 2018.


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