3.3.1. Higher Education Finance in the Pacific Region

More than in other global regions, OECD nations on the Pacific Rim had emphasized loans to help lower low-income college students' net costs, a strategy advocated in the Washington Consensus. Korea, Japan, Australia, and the US were the most privatized nations in the Pacific [73]. Like the US example, Korea, Australia, and Japan were in the top half for access. In contrast, Japan joined Mexico and Portugal as highly privatized OECD nations with lower-than-average college continuation rates. The Australian model of income-contingent repayment is an option being considered by some Asian countries as they review hardships caused by conventional loans.

The efficacy of loans has also become a topic of inquiry in the region. In Japan, traditional time-bound repayment has caused hardships for graduates, and the nation is considering shifting to income-contingent repayment as a national strategy [86]. A South Korean study found that borrowers concerned about their ability to repay had less social wellbeing, including feelings of despair [87]. The shift to loans over socially progressive forms of finance differentiates the Pacific economies from Europe. Students from lowerand middle-income families are more likely to depend on loans than wealthy families. Thus, nations shifting to privatization use debt to substitute for tax revenue and place the burden on students concerned about their ability to repay. Cross-generation decline—a pattern evident in the US and Europe [52]—is a possibility in many nations engged in the global economy.
