Higher-education reformers are often of two minds when the talk turns to markets. Most don’t like markets, arguing that much that is wrong with higher education starts and ends with the commercialism and unbridled pursuit of economic advantage that have accompanied the academy’s embrace of competitive markets. The most outraged even have a word for what has transpired: commodification.
Part snarl, part slogan, part technical term — it is the process by which markets transform educational experiences into educational commodities or products —commodification is the sure sign that the nation’s colleges and universities have gone astray. Money matters too much — values hardly at all. Students have been transformed into customers. Faculty have been told to become entrepreneurs, which is just a step above being money-grubbing ambulance chasers. The academy, which was once venerated as a scholarly community, is now little more than a business constantly worried about its bottom line.
Other critics, however, complain that markets have not done what markets are supposed to do — reward efficiency and educational innovation. Foremost among this group of what I have come to call the efficiency pundits is Richard Vedder, fellow member of the Spellings Commission, whose Going Broke by Degree: Why College Costs Too Much spells out the case against higher education’s profligacy. His argument begins with the declaration that higher education is not really subject to market forces. A host of third-party payers — principally the states, the federal government, and subsidized loan programs — have largely allowed colleges and universities to raise prices at will. Thus shielded from the rigors of a truly competitive market in which productivity and efficiency convey substantial advantage, colleges and universities have grown slothful. Productivity is down, economic discipline is negligible, and far from favoring the entrepreneurial and efficient, universities use their near market monopoly to protect the outdated and outmoded.
In an important, though not always understood way, both are right. Coming to understand how and why requires a short return to the key lessons Derek Bok tried to teach us about academic marketplaces.
Still more to come …
