The US approach to higher education is no longer the world leader as the "Confucian model" has put East Asia's universities at the cutting edge.

This was the argument set out by Simon Marginson, professor of higher education at the University of Melbourne, in a speech last week at the University of Nottingham's Lord Dearing Memorial Conference on the Globalisation of Higher Education.

Professor Marginson argued that the East Asian tradition of families funding university fees freed up state investment for elite universities and research and development.

"Unlike the West, the East has found a way to pay for expansion in higher education and research," he said.

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So deeply embedded is the educational ethic in the East Asian consciousness that "many families, even the poor, invest as much in education as British families do in housing", he added.

Under the Confucian model, educational achievement is a mark of family honour, Professor Marginson said.

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This has led to soaring university participation rates in East Asian nations, most notably China and South Korea. Governments there also tend to wield a high degree of control over higher education, Professor Marginson said, in search of national economic benefits.

Below the university level, the Organisation for Economic Cooperation and Development's Programme for International Student Assessment shows that the Shanghai region of China tops the table in maths, sciences and reading. East Asian nations dominate the top five in all three categories.

Professor Marginson said of the Confucian model: "Right now it is very effective at achieving its aims. Western governments can only wish (they were as successful)."

He highlighted the UK government's decision to cut public funding for universities in England, replacing it with higher tuition fees from 2012-13.

"In England, the state plays the public interest against the private interest," he said.

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While the US federal government has a good understanding of the value of higher education, Professor Marginson argued, state governments are cutting funding for public universities.

He said state governments were driven by a political culture that is "nuts about low tax, but not nuts about education".

As a consequence, "the US approach is no longer the leader", Professor Marginson said.

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But he also identified the Confucian model's disadvantages, including poor student experiences - or "student suffering" - and the variable quality of the private institutions paid for by poor families.

And in Japan, he argued, the university sector had ended up "culturally conservative and too state-controlled", with higher education widely viewed as a social "screening" process.

"We need a plural university world," Professor Marginson said. "I think it is an essential precondition for developing an inclusive global society."

He added that it was a "strange time" for the Western university, with "so many problems inside the national border, so many possibilities beyond".

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"But in the universities of the East, the times are positive and amazing," he said.

john.morgan@tsleducation.com.