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 6: Corporate Capitalism and the University as a Business

Donald R. Stabile

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


The twentieth century was the century of business in the US. There may have been periods when business was on the defensive, such as the 1930s and the 1970s, but for most of the century business could take credit for a transformation in the US economy and society that is still dizzying. In 1900 few persons had automobiles, and no one had flown in an aeroplane, watched a television show or surfed the Internet using a computer. These and other activities too numerous to mention now comprise ordinary human events. The corporate system of large firms that we both love and hate brought all of them to us. In academia large universities also became the norm. To paint the big picture of those changes, between 1900 and 1930 the number of colleges and universities expanded from 977 to 1907, with the number of students increasing from 238 000 to 1.1 million; the average number of students per institution more than doubled from 244 to 577. The number of degrees conferred rose from 16 314 in 1900 to 128 243 in 1930. Universities grew larger and their course and program offerings became more varied. Medical and law schools at universities increased in number, and other graduate and professional schools became more common. Professional programs gradually infiltrated into the undergraduate curriculum as well, with undergraduates majoring in disciplines such as engineering, journalism, business, nursing and education. Because the changes in academia associated with the large university correlated with the growth of the...

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