Japan promotes doctoral education by providing financial support to Ph.D. students and encouraging firms to hire graduates. To evaluate these policies, this paper develops a heterogeneous agent macroeconomic model in which Ph.D. graduates can work in the industrial sector as well as in the academic sector. In general equilibrium, the industrial-sector career option barely works as insurance for students who aim for an academic career. In the economy with this career option, a student subsidy generates a larger increase in overall enrollment than a hiring subsidy of the same fiscal cost. The hiring subsidy instead moves some students who would have entered academia into industry and raises aggregate output. These results suggest that the choice between these fiscal policies should depend on whether the goal is to attract new Ph.D. students or to change the careers of those who would enroll anyway.