Dr. Richard Vedder, Productivity in Higher Education
February 8, 2010
Richard Vedder studies higher education financing, labor economics, immigration, government fiscal policy and income inequality. A distinguished professor of economics at Ohio University, he is the author of several books, including Going Broke by Degree, and The Wal-Mart Revolution: How Big Box Stores Benefit Consumers, Workers, and the Economy (with Wendell Cox). Dr. Vedder earned his Ph.D. in Economics from the University of Illinois.
The Center for College Affordability and Productivity (CCAP) is an independent, not-for-profit research center based in Washington, DC. The CCAP exists to help facilitate a broader dialogue on the issues and problems facing the institutes of higher education in the United States.
KCH: Let’s start with the CCAP. What is the original mandate of the Centre? And what role do you see the Centre playing in the coming years?
RV: CCAP was founded in 2006 because I felt there was a need to make colleges more productive and affordable, and a big part of that involved substituting the discipline of markets for the highly inefficient process by which colleges operate today. My service on the Spellings Commission on the Future of Higher Education heightened my sense that colleges will never reform on their own, and that public opinion needed to move in a way conducive to force major reform and innovation.
KCH: You’ve suggested that less, not more people should be attending college. Is this based on a different view of the needs of the labour market, the role of universities, or both?
RV: Obviously we need college graduates –but how many? Part of my concern here does relate to labour markets —there is evidence in the U.S. that the number of college graduates exceeds the number of jobs available that require the skills associated with a collegiate degree. Part relates to the abilities and determination of students — too many are admitted to college for whom the prospects of success are minimal, and vast resources are wasted on them. Many students are dropping out of college with no degree but large student loan debts –how does that serve either them or society more broadly?
KCH: My personal focus is the use of technology in higher ed. And I’ve suggested in a number of conference papers that we need to pay attention not only to the specific ways in which technology is used in higher ed, but also its broader, longer-term impact on the way in which our entire institutions operate – how we structure our organizations, share information, allocate resources, compete with each other, and so forth. What is your view of the impact of technology on higher ed, to date?
RV: I think the three “I”s of higher education reform are incentives, information, and innovation. We need to incentivize school staff to use technology as a cost saving device, something we have done only to a modest extent to date, although the market driven proprietary schools are becoming very good at it. We still teach pretty much the same way Socrates taught the youth of Athens 2,400 years ago, with a little PowerPoint or Blackboard thrown in as a supplement. Possibly excepting prostitution, no other profession has had so little productivity advance in 2,400 years as teaching.
KCH: You’ve written extensively about the rising cost of running universities. And you’ve noted that administrative costs are rising faster than instructional. Can you explain the factors behind these developments?
RV: University bureaucracies grow because they can -institutions use their autonomy to take vast portions of new resources to pad their non-academic staffs. The leaders of institutions want more assistants to do their work and make them seem powerful and important. At a typical American university, a 20 percent reduction in administrative staff could occur with no reduction whatsoever in academic quality, reducing costs and leading to more efficient governance. In the for profit private sector, the pursuit of profits and the presence of tough competition leads firms to try to minimize costs, including administrative ones. The incentives for that type of cost-cutting in higher education are dramatically less.
by Matthew Ulmer, Manager of Communications, IDP Education
Third-party international recruitment services, or “agents,” have received a good deal of attention recently. As institutions evaluate methods to expand their global outreach even as their budgets shrink or remain stagnant, now seems like a good time to discuss the many myths and truths regarding such placement services.
Three of the main myths agents often hear are that their services are illegal in the United States, they don’t have students’ best interests at heart, and that more often than not they send unqualified or inappropriate applicants that squander admissions officers’ time instead of freeing it up. One of these myths is false, the other two depend on a number of circumstances.
Illegal?
There remains no law or federal regulation against the use of third-party representatives for international student recruitment. Most often cited is the NACAC organization’s Statement of Principles of Good Practice, though this does not extend to overseas outreach. Additionally, NACAC’s reference to the payment of incentives for successful student enrollments applies only to its members (institutional employees responsible for admissions decisions), not vendors, alumni or other recruitment partners who may refer student prospects.
In actual business practice, student recruitment services can be compared to other professional services such as search firms for executives, real estate agents for campus property acquisition, financial services for endowment fund management, and pay-for-performance advertising channels such as online directories and website advertising.
Inappropriate motives?
The other two myths often heard can in fact become truths. Many agents are more concerned with making money than fostering the right relationships, and many will refer any students interested in a school, regardless of qualifications, simply to collect a fee from those students.
Most agents, however, have been in business for years and have built successful enterprises that put a student focus above all. They take the time to fully understand an institution and its desired students in order to become a trusted partner, as opposed to chasing a commission. A similarity can be found in the field of financial planning – for every crook who makes headlines, there are dedicated, competent finance managers who recognize that it is in their best interest to keep their clients as successful as possible. The same holds true with recruitment agents – while there may be a few that taint the entire industry, university staff should understand that the majority of agents are honest partners who have been successfully guiding students for many years while following a strict set of local standards and business practices.
The key then for institutions interested in seeking outside support for expanding their global diversity is in finding the right organizations with which to partner. They are indeed legal in the United States, and many of them will be dedicated to serving both the student’s and the school’s needs by connecting the two in mutually benefit.
IDP Education is a global leader in the advancement of international education. It is the world’s largest student placement firm, is the driver of significant market research, and, as a partner in the IELTS English language proficiency test, is committed to quality and professionalism.
Apple Tablet and Textbooks: Accelerating the Move to Digital
January 25, 2010
Eduventures: Hot Programs and Hot Markets
January 25, 2010
Way, way back in 1995 . . .
There are few are areas of the higher education industry more interesting than textbook publishing. The established textbook publishers – Pearson, Cengage, McGraw-Hill and others – face serious challenges. Criticism of rising textbook prices generated awful public relations in 2008-9 (see PIRG). If the very recent NMC Horizon Report is correct, open content is looming as a real threat. And competitors have arrived sporting new business models. New competitors include Flat World Knowledge (a fantastically digital commercial open source), Symtext (which allows instructors to package digital content from multiple sources), Chegg (textbook rentals). And of course there is that little outfit called Amazon that facilitates the sales of second-hand books.
Nevertheless, sales for the major textbook publishers remain strong. But my friends working for the majors seem convinced that change is coming and that it’s going to hurt.
It wasn’t meant to be like this. The rise of digital higher education was meant to make things easier for publishers; it was an opportunity to expand the publisher’s role in higher education. At least this is how Eli Noam, Columbia University professor imagined it back in 1995. In a paper written for the journal, Science, the Communications professor speculated that in the coming online higher education market, publishers would be ideally suited to compete with traditional universities (whose status, previously protected by geography, was set to erode). Publishers might go so far as to establish their own online universities, “McGraw-Hill University”, that will “assemble an effective and even updated teaching package, making the traditional curriculum at universities look dull by comparison . . . “.
Eli Noam: Electronics and the Dim Future of the University.
“In any event, the ultimate providers of an electronic curriculum will not be universities (they will merely break the ice) but rather commercial firms. Textbook publishers will establish sophisticated electronic courses taught by the most effective and prestigious lecturers. At present, tuition fees at private universities are nearly $50 per lecture hour per student, not counting most of the public and philanthropic support that universities receive or the opportunity cost of students’ time. With such Broadway show-sized prices, alternative providers will inevitably enter the electronic education market. Today’s students, if they seek prestigious jobs or entry-restricted professions, usually have no choice other than to attend university. However, this is a weak and mostly legal reed for universities to lean on, and is only as strong as their gatekeeper control over accreditation and over the public’s acceptance of alternative credentials. When this hold weakens, we may well have in the future a “McGraw-Hill University” awarding degrees or certificates, just as today some companies offer in-house degree programs. If these programs are valued by employers and society for the quality of admitted students, the knowledge students gain and the requirements that students must pass to graduate, they will be able to compete with many traditional universities, yet without bearing the substantial overhead of physical institutions. It is likely that commercial publishers will assemble an effective and even updated teaching package, making the traditional curriculum at universities look dull by comparison, just as “Sesame Street” has raised the expectations of pupils for a lively instructional style. Already available on video is the “Greatest Lectures by America’s Superstar Teachers,” distributed by a company advertising itself as “your private university, staffed exclusively by a ‘dream team’ of America’s best lecture professors.” Degrees are granted by the all-electronic International University College, affiliated with the big cable TV company Jones Intercable. The same company also offers courses on Jones’ Mind Extension University channel and students can receive credit from any of several dozen universities.”
Originally published in Science, Vol. 270, pp 247-249, October 13, 1995
For a while it appeared that Noam’s predictions would be realized. In 2000, Harcourt Publishing opened Harcourt University in the state of Massachusetts, but closed soon after. A more successful venture, Universitas21, sponsored by Thomson Corporation, drew on Thomson’s (Cengage in the United States) instructional library in a collaboration with multiple universities across the globe to offer online MBAs.
What role will textbook publishers play in the future of higher education?
“Glee” meets “Youtube” meets “Higher Ed Marketing”
January 20, 2010
