The myth of the competitive market: Linkage with the private sector and problems for higher education reform

Abstract

Higher Education systems in Western countries currently face many problems. The enormous amount of information and reflection carried out by the members of the SRHE-Leverhulme Study team reveals the scale of these problems in one country.

This article focusses on the validity of solutions which would substitute market mechanisms for a system of free education. With this in mind the results of the French experience in the area of professional continuing education are discussed. The idea of turning to the marketplace for initial education stems from a misconception. The second part of the article is concerned with the whole of the university population. In some respects it is unrealistic to claim that students' decisions to undertake university studies can conform to rationality through the operation of human capital theory. How can the market regulate education-employemt relations when equilibrium depends on the volume of the flow of students in x previous years, and when at the same time current techniques do not permit reliable forecasts of qualified manpower needs? Moreover, the socio-economic checks on the adoption of market mechanisms form a nearly insurmountable barrier in European countries. Like the SRHE-Leverhulme Study's conclusions, the article ends by attempting to find a realistic solution to such problems, which involve in part a reform of the methods of operation of higher education institutions.