The idea – which I have to say has affected large numbers of politicians – that you can just give people at university a certificate and, hey presto, they’ll earn this amount more and the country will be x-amount richer has always seemed so bizarre to me that I have to pinch myself that so many apparently rational people believe exactly that. . . .
We know that pouring out skills is not one of the key ways in which you generate growth. Look at past experiments. Did the Soviet Union become the greatest economy in the world through a combination of planned allocation of resources and making everyone do engineering and science? No, it didn’t. Take a look at some of the successful economies. Look at Switzerland. It has one of the lowest higher-education enrolment rates in the world, yet it has a fantastic economy. If the economy demands skills and you’ve got a decently responsive higher-education system you’ll end up with an equilibrium situation… You don’t generate growth through number of graduates.