Three approaches that can guide a nation's public policy with respect to graduate education and the supply of highly educated persons are discussed: manpower planning, human capital analysis, and the principle of free student choice. The first two perspectives were judged to be inappropriate and the free-choice principle endorsed. The reliance on individual decisions that follows from this principle, however, requires sound labor market information if the combined actions of students, universities, state and federal legislatures, and employers are to result in reasonably efficient outcomes: i.e., approximate balance in the supply of and demand for individuals with advanced education. The current state of the labor market forecasting techniques for doctorates was reviewed with the following conclusions: (1) Existing techniques for protecting future supply of and demand for doctorates were found to have serious limitations. (2) It was found that too few resources have been applied to the collection and analysis of information pertaining to the labor market for highly educated manpower. (3) The federal government places too much stress on the immediate state of the labor market in determining policy with respect to the support of graduate education. The report concludes with 6 recommendations designed to improve the environment for decision and policymaking with respect to graduate education. (Author)