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The globalisation of higher education implies the application of a neo‐liberal market forces model based on competition and choice. This is happening in Germany by gradual stages, and is often, but not necessarily correctly, assumed to be antagonistic to the Humboldtian model that underlies the classical German university tradition. This paper reports a survey which showed that staff and student role relationships were permeated by paradoxes and mutual incomprehension, and that the goodwill, dedication and respect of the professors towards their students were being wasted due to deficits in organisation and structure. Freedom, an integral part of the Humboldtian model, was much more beneficial to the staff than to the students, many of whom called instead for better guidance and course structure. The professors were sceptical about some features of re‐structuring such as more executive leadership on the part of their management, and did not want their institutions to be run like enterprises—though they did want them to have more autonomy. About one third were willing to accept a diminution in state power. The system seems at a stage where the advantages of the Humboldtian model are being 'delivered' only incompletely, and the potential of a market model has not yet been fully realised. Humboldt was himself an intellectual predecessor of neo‐liberalism, and would not have been opposed to the notion of a reduction in state power, even though this runs counter to the present 'German model'. [ABSTRACT FROM AUTHOR]