This paper presents an overview of government policies for funding higher education in 11 Organization for Economic Co-operation and Development (OECD) countries. In particular, it describes the mechanisms for funding the university sector and the extent to which the grants to universities are oriented on performance. Are universities funded on the basis of what they produce in terms of graduates and research outputs? And what is the share of public funding supplied through research councils?Although in recent decades the attention paid to issues of ef ciency, effectiveness and quality has increased, there are only few governments that explicitly link universities' resources to universities' results in the areas of teaching and research. This is illustrated by means of a graph. A number of tentative reasons for the popularity of enrollments-based funding approaches are presented in the nal section of the paper.

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In this article we compare the mechanisms for funding higher education institutions across a set of OECD countries. First, some data on public and private funding levels are presented. The article then discusses two important trends: (i) the increased presence of cost sharing and (ii) the move towards performance-based funding. We show where countries differ in terms of the fees paid by students and the financial support received by students. Using the degree of output orientation and the degree of centralization as dimensions to classify the various countries' funding mechanisms, differences may be shown between countries. Reforms in funding approaches, inspired by new public management thinking, are discussed. One such reform is the introduction of performance agreements that increasingly underlie the public budget of universities. We focus on the drivers of the reforms and the question of whether these reforms actually matter for the performance of national higher education systems-for instance on the issue of student completion rates.

In the light of the Bologna process, traditional degree programmes of research-led universities in the Netherlands have been transformed into 3 year bachelors programmes and 1 or 2 year masters programmes. The Dutch universities of applied sciences (UAS) mainly offer 4 year bachelors programmes. In principle, this UAS bachelors degree qualifies UAS graduates to continue their higher education at university masters level. The bachelor-master structure introduced in 2002/2003 created new opportunities for UAS graduates to enrol in university masters programmes. For research-led universities this is an interesting new student market. The main question in this article concerns the magnitude of this new market and the motivations of UAS graduates to continue their higher education at the research-led university level.

The concepts of differentiation and profiling are cornerstones in discussions about the organisation of contemporary higher education systems, following the trends of massification and global competition. This contribution provides a system-level description and comparison of the German and Dutch higher education systems regarding these topics, and points to possible interactions and development concepts connecting differentiation, strategic profiling of universities and excellence. Though both higher education systems started from very different positions and with differing policies towards differentiation, the global trends and national aspirations for the systems, as well as individual universities in Germany and the Netherlands, are comparable. A look into the resulting ranking positions of German and Dutch universities generally shows a more successful development for the Dutch higher education institutions in the last few yearswhich could possibly indicate a crucial time lag in the effects of differentiation policies in higher education as the German excellence and differentiation efforts fundamentally took hold more than 10 years after the Dutch initiatives in this field.