In essence, universities are the center where human civilisation is created and disseminated, not markets where products are traded; and also higher education is a public good serving all human beings. For centuries, universities have performed a crucial function in the human society, providing higher education in practical fields of knowledge as well as preserving cultural traditions. In the 19th century, scientific research was introduced to the mission of universities. At the end of the 19th century, western thought and science were brought to China largely accompanying the establishment of Chinese universities. Thus modern higher education has greatly changed the Chinese history. Some people may argue that higher education has a commercial value, i.e., investing financially in one’s higher education guarantees one’s future and increases one’s earning power. However, higher education prepares young people for the whole of their adult lives, rather than just providing them with skills for employment. Higher education not only enhances the dignity of the individual, but also in the long term promotes the common good in a society. Higher education plays such an important role for the human society that universities have been sponsored by the state or the church throughout a long history. Treating higher education as a commodity may do harm to higher education institutions (HEIs).
The law of supply and demand of the free market is hostile to higher education. There exists the possibility that HEIs are becoming ‘diploma mills’ due to the pressure of market forces. No one wants to pay good money to an education service provider if one cannot be guaranteed a qualification, therefore the provider will reduce the risk of failing a course so that more customers will have confidence in the product. This illustrates the fact that there is a force from the supply side which causes a lowering of standards in qualifications in a free-market education sector. In addition, the high standards currently guaranteed by the state might be weakened because regulatory measures should not be ‘more burdensome than necessary to ensure the quality of the service’ (WTO, 1994:8). The government also loses the control of the content of higher education courses.
The outcome for the demand side is even worse. The poor students have to choose a less rigorous institution partly because they cannot afford the expensive tuition for a reputable university and partly because they need to ensure that they can gain a qualification. There is a trend today in China that more and more students from less affluent families give up their chances of attending key universities even if they have gained high grades in the entrance examinations and turn to technical colleges because of their cheaper tuition and shorter period. It seems that a free market in higher education enhances the class division.
The commercialisation of higher education perpetuates and exacerbates the social disparity. Free higher education had been an instrument to promote the social mobility of people from one social stratum to another and hence balanced social inequalities within the society. But this no longer exists in a so-called free market dominated and globalised world. Higher education is now seen as a commodity, a private good benefiting those who study or do research. In addition, restrictions on state subsidies by the GATS have negative consequences: many countries are gradually reducing the financial support to their HEIs. Hence, universities have to generate more of their revenue in a similar way to other business companies. Nowadays the existence of fees for higher education and then the continuing increase of these might seem inevitable. This has a greater impact on the poor. In China, some universities started to charge tuition and fees in 1994 and then all the HEIs followed in 1997. Tuition in all HEIs in 1999 increased by 30 percent over 1998 throughout China (Yuan, 2000:9). It is estimated that a 10 percent increase in tuition would bring about a loss of 11 percent of the students attending HEIs in China (Postiglione, 2002). Furthermore, a survey in China reveals that the percentage of students in HEIs from mid-upper class families is growing, while the proportion of those from lower income families is decreasing with the increase in tuition in recent years (Hong, 2001). It is increasingly clear that those most likely to suffer from unrestricted market forces in higher education are the disadvantaged.
In conclusion, higher education should not be viewed as a commodity although it is becoming a traded commodity due to the GATS agreement and the globalisation of the economy. It is suggested that higher education be a basic human right and a public good serving the whole society and not be at the mercy of the rules of the free market. Moreover, there is a risk that commercialisation might deprive the poor of their opportunities for higher education and hence increase social inequality.
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