German universities and technical colleges are bursting at the seams. The lecture halls are overcrowded and there are too few lecturers. This is one reason why many young people either do not attend a university at all, take much longer to study than planned, or drop out altogether.

Germany produces too few academics, particularly in subjects which are important for the economy – maths, computer science, the natural sciences and technology. Education is largely the preserve of the 16 states, or Länder, which constitute the Federal Republic. However, state governments tend to invest too little in their universities because the returns on education spending are too low. Many graduates move to other states and pay their taxes there. For the states, it is therefore more profitable to keep their education budgets low and recruit well-educated workers from their neighbours.

This strategy could be effectively thwarted by introducing a voucher scheme financed by the states according to their need for academics. School leavers would receive an education voucher to be redeemed at the university of their choice. The scheme would strengthen the hand of students as consumers, reward attractive universities and the bill would be footed by the states which benefited most.