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What Role Should Capitalism Play In Higher Education?

What role should capitalism play in higher education?

Higher education struggles with the role online education plays at institutions, and at what cost. In the past two weeks, opposing articles articulated this conflict.

The first was Kevin Carey’s exposé, “The Creeping Capitalist Takeover of Higher Education” published by Highline on April 1.

The second was Mark Lieberman’s upbeat article from Inside Higher Ed from April 17: “Champlain College slashes undergraduate online tuition in half — with surprising results.”

Carey describes the effect of Online Program Management firms (OPMs) on the cost of online programs, as well as how the school’s desire for more revenue affects cost. The high tuition is particularly attractive given the relatively low cost of delivering online courses. The result is marginal revenue (smells like capitalism!).

The outcome of this trend is that access to schools is constrained only to those who can afford the higher costs. The false claim that online would mean greater affordable access gives way to the lure of easy money. In addition, the artificially high tuition affects the staggering growth of student debt.

Perhaps even more insidious for the schools is that the high tuition reduces the pool of students. The result in a competitive environment like higher education is empty seats. Empty seats equal lost revenue, creating a vicious cycle unsustainable for most schools.

Contrasted with Carey’s grim assessment is the story of Champlain College in Vermont. Champlain is a private college with an undergraduate enrollment of about 4,000 students. While their tuition is high ($41,000), they enjoy a first year retention rate of about 80%.

SOURCE / / Champlain College

Champlain has a unique approach to delivering their 11 online undergraduate programs. They cut online tuition to about 40% of their terrestrial tuition. In addition, they targeted people who had stopped out of their undergraduate education.

Schools have been seeking a viable approach to degree completion, and Champlain might have nailed it. Under the plan, undergraduate online enrollments have doubled, and retention of those students is an admirable 80%. Champlain remains a solid, accredited private non-profit that has increased its access, opened up new markets, and retained its stability – by serving its markets better.

Both articles highlight the same challenge:

Institutions must find a balance between the traditional and the innovative, between tenured faculty offering their curriculum and OPMs “customizing” online, asynchronous offerings. How do faculty members retain control when schools sign with an OPM?

The Carey and Lieberman articles explore other points, of course, but it seems that the ominous tone of Carey’s thoughts are offset by the upbeat and market-focused approach by Champlain.

In this time of the “post-traditional student,” we know their main decision criteria:

  1. How long?
  2. How much?

Schools must know their markets and their goals. However, do we want our institutions governed only by capitalist concerns?

There is balance, and markets like EduForum offer new solutions that encourage more tradition-focused innovation – maybe the best of both worlds.

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