I’m in Japan this week, and amid all the futuristic buildings, hi-tech, and gloriously efficient public transit, one is continually tempted to ask: how much of this has to do with Japanese higher education? In the Canadian higher education sector we keep telling ourselves how central universities are to economic growth and innovation process, so by that logic, a gleaming technological marvel like Japan must have some kick-ass research universities, mustn’t it?

Actually, no. Sure, Japan has a few top schools – Tokyo and Kyoto, for instance, compare with most any public university in the world. But overall, their universities significantly underperform relative to their peers in terms of research production. Serious scientific research in Japan is much more likely to happen in corporate settings than in academic ones (the Bell Labs equivalents here were never dismantled). Since the centrality of university research to innovation is, to a large extent, an inverse function of business productivity, universities simply aren’t so crucial where the business sector is actually on the ball.

Well then, Japanese universities must be turning out loads of skilled labour, right? And since it’s such a high-tech country, they must be miles ahead of us in terms of STEM subjects.

Still, no. About 17% of university enrolments in Japan are in engineering, which is much higher than in Canada, but only about 2% are in the sciences, which is much, much lower. As a result, Japan’s overall STEM enrolments are slightly lower than ours. And there are also serious complaints about quality, with universities here being called “Ivory Basements,” a four-year party-filled hiatus between the rigours of high-school and finding a job. Some of these complaints have tapered off a bit recently after major reforms under Prime Minister Koizumi, but there is a long way to go.

(One area where Japanese universities really are unique? Marketing. I’m 100% sure that in no other country would Peter Rabbit be considered a suitable subject for an institutional branding campaign, as he is at Saitama’s Daito Bunka University.)

Here’s the crux of it: countries actually can get by pretty well without massive university systems. Germany and Switzerland send very few people to university yet have quite advanced technical economies. The optimal mix of education can differ substantially from one country to another based on the range of industries one possesses. That’s not to say that you could just tear down our universities and expect the same results as Germany or Japan – it’s just to say that their capabilities and optimal role is heavily circumscribed by their institutional environment.

Universities aren’t inherently central to economic development. It’s all down to context.