EKIP– Expert Club for Economics and Politics A Different Opinion
While reading material about the upcoming debates on the topic of the “modernization” of higher education in Bulgaria, I came across a text that can clearly illustrate the essence of the problem [1]. At the end of the cited article, there are several questions asked that I would like to pay attention to, adding a few small corrections (on my behalf in italics and bold ). These are important questions that potential reformers or lawmakers must answer in order for higher education to move forward.
1. Should the form of governance of higher education institutions ( mobile phone manufacturing companies) be changed? If a University Board (Control Board) is to be introduced, what should its composition be, how should it be formed, what should its functions be, to whom should it report and what responsibility should it bear for its decisions?
2. What needs to change in the way higher education institutions (mobile phone manufacturing companies ) are financed and managed, so as to stimulate high-quality education ( mobile phones), and not simply hand out diplomas ( low-quality devices ) for a fee?
3. How to attract foreign students ( customers) who want to receive an education ( mobile phone) in Bulgaria with European quality, and not just a European ( mobile phone ) diploma? How can Bulgarian universities ( mobile phone manufacturers ) be supported to provide such education (such GSMs)?
4. What is the optimal structure of higher education institutions in Bulgaria ( manufacturing companies...) , in terms of number and by region, and how can we achieve it, starting from the current situation?
5. How to organize and finance scientific and innovative research in universities (in mobile phone manufacturing companies )? How to ensure the best efficiency of public funds spent on science and education (mobile phone manufacturing)?
6. Should there be a state "planned" admission of students (planned production ), according to business requests? Are there other, non-administrative forms for improving the admission and preparation of students ( for the design, production and distribution of mobile phones ), with a view to their realization?
The comparison should be clear, this (not entirely exhaustive) list of unanswered questions faces every centrally planned economy. Solving them, as economic theory and historical practice have shown, cannot be achieved by the actions of politicians or bureaucrats. And since it seems unthinkable to us that someone in the Ministry of GSMs would say what number, for how much money, with what functions phones to use, why do we think that it will somehow work out in education? So far, I don't think I've heard of any "public discussions" about how many factories Apple or Samsung should have or how Steve Jobs should take some innovations to produce.
It is time for students to become customers, and for universities to stop surviving on subsidies and start offering a real service.
[1] http://www.karieri.bg/biznes_obrazovanie/2256579_kakvo_triabva_da_vkljuchva_reformata_vuv_vissheto/
The approach of comparing and contrasting "firm" and "university" (higher education system) is completely wrong and can lead to delusions. Higher education is outside the market as described in textbooks. A market approach in this area would lead almost every university to direct bankruptcy and closure.
The most obvious difference is that absolutely all companies work to generate profit. Universities are supported mainly by taxes (state) and donations (private). There is no return on capital, profit and dividends here. Those that work for this purpose (generating profit) are extremely few in number and marginal in activity. The quality of their services is significantly below average, they have no influence and scope and are practically irrelevant to the higher education system.
If universities and their activities are to be compared to anything, it is the church, not the companies. After all, modern higher education originated there, not from the craft training in medieval guilds. Harvard, for example, does not manufacture telephones and does not plan to manufacture telephones in the near future - it does not care at all whether the market wants this product or not. Harvard produces missionaries.
@Toto5
"Higher education is outside the market as described in textbooks."
That's exactly the case, and that's the problem, namely that it's out of the market.
"The market approach in this area would lead almost every university to outright bankruptcy or closure."
And that's true. However, an economy needs universities, so there will be universities. Whether they will be completely new ones or transformed/reformed old ones is irrelevant.
"The quality of their services is significantly below average, they have no influence and reach, and are practically irrelevant to the higher education system."
I think we discussed the topic some time ago and how it is practically impossible to compete with a competitor who offers their services at a ZERO price. Moreover, you will have to pay taxes to support the competitor. So it's no wonder that private companies are bad. We should be most surprised that they exist at all.
@EE
"it is practically impossible to compete with a competitor who offers their services at ZERO price"
In fact, the price does not matter at all. The church provides free services, but there are also paid ones - for example, the "baptism" service. What chance does a commercial company have of competing in the "baptism" market with the church, even if we assume that it offers "baptism" of significantly higher quality and at a price many times lower than the church's?
If we answer the question "What exactly is the "Service" (with a capital U)" provided by universities (the same ones that currently do not work for profit, but are supported by taxes or donations) we will understand whether it is possible for a market entity to provide a similar service and whether there is a chance that the market for this type of service will obey the same rules that the telephone market obeys.
@Toto5
"What is the chance of a commercial company competing in the market for "baptisms" with the church, even if we assume that it offers a "baptism" of significantly higher quality and at a price many times lower than the church's?"
Well, at the moment it is zero. The reason is that the Bulgarian Orthodox Church is a monopolist. Otherwise there would be no problem. There used to be an alternative synod, but as you know, they threw it out by force (of course, LEGALLY).
By the way, such analogies, even if they are correct and on point, do not prove anything. Analogies by default cannot be accurate, and that is why I personally use them only to illustrate a given thought. The evidentiary weight of analogies is zero.
"If we answer the question "What exactly is the "Service" (with a capital S)" provided by universities?"
The service is: Training. And it is even currently offered for a fee in some places.
Look: Just because you can't imagine something because you haven't seen it, doesn't mean it's not possible.
@EE
"Well, right now it's zero. The reason is that the Bulgarian Orthodox Church is a monopolist. Otherwise there wouldn't be any problem. There used to be an alternative synod, but as you know, they threw it out by force (of course, LEGALLY)"
You see - my question was about a commercial company - LLC, AD, etc. It didn't even reflect it, it didn't allow such a possibility at all. Yes, an alternative synod can offer a similar service, as can another religion, but they all remain Churches, not LLCs.
"The service is: Training."
Error.
The main services are "brainwashing", "soul capture", "brain control"
i.e. if the student's intelligence is low - laundering
if it is medium - inclusion, seizure
if high - controlling
Or in a word, FORMING the personality in a way that is convenient for the elites, and the ultimate goal is power.
Ето какво казват от Станфорд:
And its purposes, to promote the public welfare by exercising an influence in behalf of humanity and civilization, teaching the blessings of liberty regulated by law, and inculcating love and reverence for the great principles of government as derived from the inalienable rights of man to life, liberty, and the pursuit of happiness.
And this is from the UNWE:
The University of National and World Economy is called upon to form highly educated individuals who will lead society towards a more perfect and humane world.
Хората даже не го крият, а си го казват директно - "формиране", "насърчаване", "упражняване на влияние" и т.н.. Няма обучение - обучение предлагат техникумите и занаятчийските училища.
За каква професия например се обучава един бакалавър по икономика в Харвард?
@Toto5
"You see - my question was about a commercial company - LLC, AD, etc. It didn't even reflect it, it didn't allow for such a possibility at all."
The church, I assume you know, is a business. And it has always been that way. The fact that we don't call it an LLC is just a detail. It goes under a different paragraph in the law. De facto, they are also private individuals. Even ones with great preferences over others. I spoke in that sense. I haven't thought at all about whether it matters under what paragraph a private individual is registered (or not subject to registration).
"The service is: Training."
"Mistake.
....
Or in a word, FORMING the personality in a way that is convenient for the elites, and the ultimate goal is power."
You are right, but not completely. Take the exact sciences as an example. There you cannot blabber and make people accept your arbitrary statements (for example: "Democracy is the greatest form of government",
"Without the welfare state, people will die in the streets", "If it is not for the state to protect workers, they will be exploited", etc.). If you teach them nonsense, i.e. things that do not correspond to reality, then your car will not run, your GSM will not work and in general we will be at the level of the Stone Age.
Look, in the social sciences, the situation is exactly as you describe it. They teach the modern beliefs that maintain the status quo. And you can't escape that. You can only accept them. You see that they are contradictory in many places. You also see that very often the results are bad, but you maintain them because you grew up with them. For example:
Ancient Egypt: "The Pharaoh is the representative of the gods on earth. How will we live without a Pharaoh? It is impossible. Absurd! No other form of government is possible! If he is not to rule us, then we will perish!" Later, humanity discovered and tried other forms of government, but what did the ancient Egyptians care about? They knew the "TRUTH" and taught it to their children. We are currently in an absolutely identical situation. Only shifted thousands of years into the future.
"For example, what kind of profession does a Harvard economics graduate train for?"
For example, for a head of a high-level agency in the state administration. For a politician, etc. In short: That's where the leading elite of the state is formed.
@EE
"The church, I suppose you know, is a business."
Both yes and no.
If I decide to compete with the church for profit and behave like a normal commercial company, I have no chance. Either I have to play by their rules - convince or force someone to pay me taxes or make me donations, or I'm out of the game. A business that relies on donations and taxes is not a normal business. It is closer to the role and function of the state than to a regular LLC.
Here is a private university founded for profit - http://en.wikipedia.org/wiki/University_of_Phoenix
Its prices are higher than those of state universities and significantly lower than those of private Ivy League universities. However, in this case, they don't matter at all.
Despite the huge number of students it educates, the University of Phoenix is not a competitor to either Harvard (private, supported by donations) or the University of California (state). Apart from other for-profit universities, it cannot compete with anyone else. These are two different worlds - they have no intersection. If there were no University of Phoenix or other for-profit universities, 95% of
of their students will not be educated anywhere. Neither Princeton nor Nebraska State College is interested in them.
In higher education, there are so many interests pouring money into it without caring whether there will be a direct profit - states, various private groups, religious organizations, etc., that the market mechanism stops working. The fact is that for-profit institutions of higher education are mainly in the USA, but even there they survive not thanks to the market, but to two state programs - to guarantee student loans and to retrain former military personnel. In Europe and the rest of the world, there are no similar programs, and these institutions are a value approaching zero.
If there were a normal market, things would be completely different.
@Toto5
"Either I have to play by their rules – convince or force someone to pay me taxes or make me donations, or I'm out of the game."
You are absolutely right. People expect a church and you will have to behave appropriately. That is, give the market what it expects.
"A business that relies on donations and taxes is not a normal business."
Yes, it's not a typical business to survive on donations, but that doesn't mean it's a bad business. There are a huge number of private foundations that survive on donations, and the market and people in general benefit greatly from them.
"In higher education, there are so many interests pouring money into it without caring whether there will be a direct profit - states, various private groups, religious organizations, etc. - that the market mechanism stops working."
You're looking at things in a very general way. If there were so many and they were all willing, why would the state bother giving money for training, huh? How are you going to justify it to the electorate?
And the market mechanism will not stop working (if it is allowed to operate properly). And the reason is that people have different desires for education. For example, I would not want my children to go to universities of the type: Christian, state, with a socialist or fascist bias, etc. And if there is a suitable university available and I have enough money available for it, I would pay to enroll them there. That is why there will be different universities: those pursuing the goals of foundations (for example, Christian, with the study of religion) and those responding to the market (for example, education only in the field of exact sciences). By the way, I have not seen many private institutions with non-financial interests pushing themselves to sponsor in the field of exact sciences. You can hardly make a non-financial profit from there (to raise supporters). Not to mention that some types of education are very expensive (for example, medical education, where you have to practice, i.e. have not only halls and offices, but also laboratories, exercise rooms, equipment, etc.).
@EE
"You're looking at things in a very general way. If there were so many and all willing, then why would the state bother giving money for training, huh?"
How why? That it is the greatest passion for controlling people's minds. The state itself was created for this. Don't you think its purpose is to care for the individual?
"For example, I wouldn't want my children to go to universities like: Christian, state...
And if there is a suitable university available and I have enough money available for it, then I would pay to enroll them there."
OK, but if they decided to study in Europe, your chances of finding a suitable university available that is created with the sole purpose of offering quality education and profiting from it are close to zero. In the US, it's the same thing. You'll choose someone from the Ivy League or one of the best US universities like the University of California, Berkeley.
For-profit universities are generally not on the radar of people with average and above-average means. In fact, for over 90% of the middle and upper classes, these types of educational institutions do not exist.
For example, in Europe, most people have nothing against (as long as they have the means, financial and intellectual) their children studying at UCL, University of London (with all its divisions), Cambridge, Oxford, etc., but I don't believe anyone dreams of a degree from BPP University.
By the way, almost all for-profit universities offer affordable online education at a decent level. So anyone who wants such a diploma still has a chance. However, I don't see the benefits of it.
@Toto5
"The state itself was created for this. Don't you think its purpose is to care for the individual?"
We agree on the above question, but you are still wrong that there are enough people willing, with non-profit considerations, to fully fund education right now.
"For-profit universities in most cases do not even fall on the radar of people with average and above-average opportunities. In practice, for over 90% of the middle and upper classes, this type of educational institution does not exist."
Yes, and it shouldn't be like that. And it wouldn't be like that with a free market. Universities are for the middle and upper classes.
In a free market, education would reduce its price significantly. At the moment, this is not possible due to state regulations, aimed of course at "higher, European quality" of education.