Recessions, Regional Integration, and Higher Education Expansion

Economic globalization has transformed the role of colleges and universities in the Asian region. Rapid expansion has been fueled by an increased demand for higher education that has been fostered by the successful popularization of basic education, rising household expectations, government subscription to the discourse of knowledge economics, human resource needs, and increased availability of distance programs, and private for-profit programs (Postiglione and Tan 2007). From institutions that prepare an elite stratum, colleges and universities are becoming institutions serving multiple stakeholders. Enrollment in higher education is expected to double in five years and triple in 10 years in many developing countries in this region (ADB 2008b). Among the challenges will be improving knowledge transfer to poor communities, preparation of vulnerable youth for an increasingly competitive labor market, and confidence by households to send a child to college or university. Institutions of higher education are also becoming symbols of national ambition during times of growth as well as recession.

During past economic crises, higher education budgets have been secondary to those for basic education. However, the global recession requires different measures, including a shift toward cost sharing among different levels of the education system, a trend that is increasing in many parts of the world (Johnston 2004; Woodhall 2007). For these and other reasons, development agencies are shifting their educational funding toward regular and higher vocational education (Sarvi 2008).

Asian economies are more integrated than ever before and the demand for human resources is growing rapidly. The global financial recession has affected growth in selected sectors (World Bank 2009a). When the region last weathered an economic shock in 1997–1998, the experience provided relevant insights for the global recession and its implications for higher education, which has expanded rapidly due to rising social and economic demand (Lee and Rhee 1999). Sharp shifts in international finance promise to remain an occasional reality of the economic landscape as Asia drives toward the center of the global economy. Yet, such shifts need not deter reforms in Asian higher education as it expands access to more diverse populations and sustains Asia's knowledge transfer and economic growth. A recession is an opportune time for higher education to continue reforming institutional governance while it resists marginalizing populations from poorer regions and those who become vulnerable during major economic downturns (Varghese 2001).

Topics worthy of examination in developing regions of Asia include the effects of the economic shift on student access and retention, changes in household perspectives and strategic decision making, innovation and resilience in institutional governance, the quality and relevance of knowledge and skills transmission, cost-sharing arrangements and the sustainability of private higher education, trends in international student mobility and transnational academic collaboration, the mobility of the academic profession, the shrinkage of the graduate employment market, and funding for research (in science, technology, and medicine) that aids poor communities (Chapman and Austin 2002; Huang 2006). While the scope of this paper does not permit addressing these aspects in detail, it is possible to review selected literature and data regarding the experience of higher education in selected developing countries of Asia during financial slowdowns. Government policies to ameliorate negative impacts on higher education during economic crises can be reviewed and assessed for their effectiveness.

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