COMPETITION AND REFORM IN HIGHER EDUCATION.

It is now all but axiomatic that universities are central to the knowledge economy. Universities educate and train knowledge workers; in many countries, they are also responsible for carrying out much of the research that can contribute to the production of new knowledge. In keeping with the growing recognition of universities as institutions central to the knowledge economy, their reform has been pursued as a matter of high priority in many countries. Yet as this paper points out, there has been no rigorously formulated paradigms guiding recent higher education reforms. Though increasing the "competitiveness" of universities has been the catchphrase guiding reforms in many countries, what effects increasing competition is actually likely to have on universities--especially over the long term--has seldom been systematically examined, except by way of analogy to the effects of competition on business corporations or in the form of projections based on anecdotal evidence and guesswork. This paper attempts to sketch a typology of the effects of competition on universities, based on theoretical modeling and long-term historical analysis, especially of the competitive higher education system of the United States. It argues that competition does not necessarily have the same effects on universities as on business corporations, and in fact has been known to lead to surprising, even paradoxical results. Understanding such differences and paradoxes, in turn, is likely to lead to better informed debates on higher education reform, and may help avoid costly mistakes and disappointments. [ABSTRACT FROM AUTHOR]