Why are transfers from younger to older generations generous in some societies and not in others? For example, people in northeast Japan tend to provide better nursing care to their aged parents and invest more in their children's education than those in the southwest. Communities in the northeast tend to be small and isolated compared to those in the southwest. This paper argues that differences in intergenerational dependence are due to demographic variation in community networks. This analysis of sustainability of intergenerational transfers posits a game theoretical model of overlapping generations in which breadwinners make transfers to their parents and children. A novel feature of the model is that there is a local community that may supply information about its members' past behaviors. I demonstrate that an efficient level of intergenerational transfers can be sustained if neighbors "gossip" about each other. As an implication, my theory suggests that individuals in a close-knit community prefer lower levels of social protection. Empirical results from Japan support this argument: Individuals who interact with their neighbors tend to provide better nursing care to their aged parents, spend more on their children’s education, and demand less from the government than those who do not interact with their neighbors.      

Education has provided the critical foundation for Asia’s rapid economic growth. However, in an increasingly globalized and digital world, higher education faces an array of new challenges. While the current strengths and weaknesses of educational systems across Asia differ considerably, they share many of the same fundamental challenges and dilemmas.

The fourth annual Stanford Kyoto Trans-Asian Dialogue examined challenges and opportunities in reforming higher education in Asia. At its core, the challenge facing every country is how to cultivate relatively immobile assets—national populations—to capture increasingly mobile jobs with transforming skill requirements. This raises fundamental questions about skills needed for fast-paced change, domestic inequality, the role of government, and choices of resource allocations.

Scholars and top-level administrators from Stanford University and universities across Asia, as well as policymakers, journalists, and business professionals, met in Kyoto on September 6 and 7, 2012, to discuss questions that address vital themes related to Asia’s higher education systems. These included:

• Can higher education meet the challenges of economic transformations?
  As skill requirements change with the increasing use of IT tools that enable manufacturing and service tasks to be broken apart and moved around, how can higher education systems cope? How can education systems address the increasing need for global coordination across languages and cultures? How can countries deal with demographic challenges, with developed countries facing overcapacity and developing countries with younger populations facing an undercapacity of educational resources?

• How are higher education systems globalizing?
  What are the strategies for the globalization of higher education itself? How are universities positioning themselves to attract top talent from around the world, and what are their relative successes in achieving this? What are the considerations when building university campuses abroad? Conversely, what are the issues surrounding allowing foreign universities to build within one’s own country?

• How can higher education play a greater role in innovation?
  What is the interplay between private and public institutions and research funding across countries, and what are the opportunities and constraints facing each? What is the role of national champion research initiatives? For developed East Asian countries, a focus on producing engineers raised the economic base, but many are discovering that they are still not at the leading edge of innovation. What are ways to address this dilemma? For developing countries, the challenge is how to improve basic education from the level of training basic factory workers to creating knowledge workers. How might this be accomplished? Is there room for a liberal arts college model?

• What are the challenges and opportunities in reforming higher education?
  What are effective ways of overcoming organizational inertia, policy impediments, and political processes that hinder reform? What are the debates and issues surrounding ownership, governance, and financing of higher education?

The Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) established the Stanford Kyoto Trans-Asian Dialogue in 2009 to facilitate conversation about current Asia-Pacific issues with far-reaching global implications. Scholars from Stanford University and various Asian countries start each session of the two-day event with stimulating, brief presentations, which are followed by engaging, off-the-record discussion. Each Dialogue closes with a public symposium and reception, and a final report is published on the Shorenstein APARC website.

Previous Dialogues have brought together a diverse range of experts and opinion leaders from Japan, South Korea, China, Vietnam, Thailand, Indonesia, Singapore, India, Australia, and the United States. Participants have explored issues such as the global environmental and economic impacts of energy usage in Asia and the United States; the question of building an East Asian regional organization; and addressing the dramatic demographic shift that is taking place in Asia.

The annual Stanford Kyoto Trans-Asian Dialogue is made possible through the generosity of the City of Kyoto, the Freeman Spogli Institute for International Studies at Stanford University, and Yumi and Yasunori Kaneko.