An international research team examines California's system of postsecondary and higher education. In particular, the examination seeks answers on how California maintains educational quality, access, and equality while working with the market and the state in developing educational solutions to political, social, and economic problems. Part 1 of the report provides analyses and questions on how the state, in practice, can manage and finance the educational requirements, particularly in the context of the future demographic composition of the state (large inflows of immigrants), that stem from the constant need for highly-qualified manpower that is demanded in a technology-based economy. A bibliography of 50 items is included. Part 2 provides a record of the review meeting within the education committee, including replies to the examiners' questions. Part 3 reproduces a summary of the background report prepared for the review by the California Postsecondary Education Commission titled "Preparing for the Twenty-First Century: A Report on Higher Education in California." (GLR)