Purpose. The purpose of the study was to explore the Taiwanese policy of allowing Mainland Chinese students to study at Taiwan universities. Since China still officially regards Taiwan as an “rebellious province,” this new policy has become very difficult for public policymakers to formulate.

Theoretical framework. The theoretical foundations for this study were based on the research foundations of institutional rational choice theory, institutional analysis and development theory, multiple streams theory, and punctuated-equilibrium theory.

Methodology. A qualitative method using interviews and questionnaires was used. In-depth interviews and questionnaires were conducted with legislators from Taiwan's parliament, determined by their availability.

Major findings. This study found that the legislative results for the policy did not match the expectations of most stakeholders. The resultant policy basically negated any economic effect of an open-door policy to Chinese students. It also will potentially increase administrative costs for universities accepting Chinese students. Findings in regard to most ruling party legislators indicated that most of them were confused about their party's stance and were hesitant about the social and economic values of the policy. Findings in regard to most opposition party legislators indicate that they are against anything Chinese, so have very little room to compromise.

Conclusions. The policy is a very small step toward liberalization in cross-straits educational relations, but leaves much room for improvement. One conclusion is that the Ministry of Education will have to use its administrative powers to alter the policy in many ways to make it more effective. The key conclusion from the study is that Taiwan universities will continue to increase enrollment through exchange students, instead of using the guidelines set forth in the new policy.