More on universities

Cite this Article
Geoffrey A. Manne, More on universities, Truth on the Market (March 16, 2006),

My post on universities/Zittrain/Harvard generated an excellent comment from Mike of chicago

Here is my comment to Mike’s post:

I suppose at the end of the day and over a few glasses of scotch I would largely agree with your characterization of my position. I do believe that norms exist and can be beneficial, and that they may be shaped in competitive environments. I also agree that there is some competition among universities around the edges. But here are my quibbles.

First, I think I disagree with everything in this paragraph except the first sentence:

Geoff recognizes that; he’s opposed to uncritically encouraging more reliance on those ideals, as opposed to checking them via market discipline. Which seems fine except — how do we know when ideals should stop, and markets should start? And who’s to make the call? Geoff, rightly, is suspicious that the government should step in to police the professions; I assume, therefore, that he should be equally suspicious of the government telling, say, the Harvard Corporation (or the New York Times) that “the market� has a better idea of the public good for the university or for the newspaper than the institution’s managers do. I have a hard time believing that we shouldn’t let Harvard be Harvard, whatever that is, as defined by the Corporation (and not, by the way, by the faculty), whatever errors in judgment some believe the Corporation may make.

It is precisely my point that “we� don’t have to “know� when ideals should stop and markets start. My aversion to government planning is animated by the fact that “we� can’t know. All organizations are subject to the problems of limited information; those problems should be efficiently minimized, not exacerbated. Government tends to opt for the latter path. Universities as organizations tend also to insulate “ideals� from market forces, to social detriment, but not, of course, to the detriment of the idealists.

I am in no way arguing for a government fix to the problem; I’m merely suggesting that universities serve some ends better than others. And reliance on ideals may be a bad way to go about ensuring universities serve what I believe both Jonathan and I (and you) think are the “right� ends.

I’ve said it before and I’ll say it again: An environment that purports to foster Ideal A by removing the burdens of market pressures is also an environment where Ideal B may thrive. Ideal A might be devotion to students, commitment to knowledge, education and the free exchange of ideas. Ideal B might be laziness, self-promotion and intolerance. We’d all like to believe that Ideal A thrives to the exclusion of Ideal B, but why do we believe that? If I thought market forces were strong, I wouldn’t care; In schools where Ideal B predominated, I’d just figure that, for reasons I don’t know, Ideal B is better for students than Ideal A. But market forces are not strong here, as Adam Smith long ago made clear. Whether to do anything about it and, if so, what to do, of course, remain intractable questions.

And of course “we� should let Harvard be Harvard. I make these comments only as an observer (and maybe as a parent, although as my daughter is only 11 months old, I heavily discount the relevance); I’m not in the business of dictating behavior to private organizations. Your reductio (�well, then, isn’t government also limited in its ability to ‘know’ when to ‘dictate’ markets?�) is inapposite.

At any rate — as I said, perhaps the disagreements are slight. And, what’s more, perhaps no one really cares. Students don’t want better education; employers don’t need it; parents don’t care; etc. If it’s only the faculties who care anyway, then this may truly be the Best of All Possible Worlds.

And, of course, Brett and I are destined not to agree on much short of matters like the best version of TLEO (5-26-73, Kezar or 2-9-73, Palo Alto). Competition on the basis of ideals is all well and good as long as it’s possible credibly to commit to a certain ideal. I think that’s exceptionally difficult here (but, of course, it probably doesn’t hurt to try, and the trying might even help to make the commitment more credible).