We propose a new interpretation of the role of the state in skill formation, with reference to three East Asian newly industrialized economies. Rather than see the state as simply redressing externalities, we interpret the state as matching the supply and demand for skills in a rapidly growing economy. This role can be superior to a strategy of allowing education and training institutions to be driven by autonomous processes. The role is most likely to be observed in developmental states. We examine the political mechanisms that have helped to ensure that educational and training policy formation are subordinated to the imperatives of economic growth. While the East Asian model cannot be imported wholesale to western countries such as Britain in different historical circumstances, the example lends credence to the value of the state taking a strategic approach to education and training policy.