Economics, Competition and Academia

Economics, Competition and Academia

An Intellectual History of Sophism versus Virtue

Donald R. Stabile

Donald Stabile places current concerns over the commercialization of academia in a historical context by describing the long-standing question of the extent to which market economics can and should be applied to higher education. The debate between Plato and Aristotle on one side and sophists on the other provides a foundation for the modern debate of endowment versus tuition models. The author tackles the intellectual discourse over the mission of higher education and the effect markets and competition might have on it. The discussion encompasses the ideas on higher education of leading economic thinkers such as Adam Smith, Jeremy Benthan, John Stuart Mill, Alfred Marshall, Thorstein Veblen and John K. Galbraith and identifies them as supporters of either sophism or virtue. Included, too, are the thoughts of educators and policymakers influenced by free market ideas, such as Benjamin Rush, Francis Wayland and Charles W. Eliot, as well as those opposed to them. In addition, the author explores the development of collegiate business schools in the US and how they were justified on the basis of virtue. The book concludes with a section on for-profit colleges and their relationship to sophism.

Chapter 1: Introduction: Markets, Competition, and Higher Education

Donald R. Stabile

Subjects: economics and finance, economic psychology, public sector economics

Extract

In 1860 institutions of higher education in the US enrolled 20 000 students, nearly all of them majoring in the traditional liberal arts (Burke 1982: 216). By 2000, over 20 million students in the US were attending a college or university. While we do not know what they had as majors, there is information regarding the majors of those earning a bachelor’s degree. Of 1 237 875 bachelor’s degrees conferred in 2000, 36 104 were awarded to students majoring in the liberal arts and humanities; if we add in the subjects that were part of the liberal arts education of 1860, the total of degrees awarded in the liberal arts rises to 185 960, a tremendous growth in numbers in 140 years (IPEDS, Table 248). Growth is only part of the story, for higher education also experienced a significant transformation between 1860 and 2000. While the number of liberal arts majors greatly exceeds that of 1860, it is only 15 percent of all degrees conferred. In 2000 many students earned degrees in areas that rarely existed in 1860, including 108 168 in education (9 percent), 72 555 in engineering (6 percent), 78 458 in health professions (6 percent), and 257 709 in business (21 percent) (IPEDS, Table 250). These numbers tell us that the history of higher education in the US has been one of a revolution in both size and diversity of study. Economists might readily interpret the transformation of higher education indicated by these numbers as a case...