Law, Business and Society 11th Edition by Tony McAdams

Exercise 42

The Anderson School of Management at the University of California at Los Angeles (UCLA) received permission in 2013 to substantially privatize its prestigious MBA program. The program will be allowed to raise tuition, keep most of its income, and spend that income on attracting yet more skilled professors and students thus raising its academic profile to better compete with Harvard University, Stanford University, and the like. Anderson leaders also believe the self-sufficiency/privatization decision will allow them to raise more money in contributions, some of which are contingent on the change. Tuition, currently over $96,000 for the two-year program, is projected to rise to "market rates" for top-tier schools (e.g., nearly $130,00 for Stanford). A few other UCLA programs were already privatized and the University of Virginia's Darden School of Business became self-sufficient in 2002.
Those opposing Anderson's privatization fear that UCLA's responsibilities for the general welfare may be replaced by the more self-interested goals of those-running the program, its donors, and the business community. Perhaps, for example, a privatized MBA program would be more likely to allow admission to a major donor's child, shape its research agenda to conform to the interests of corporate donors, diminish its attention to community needs or eventually replace merit-based admission with an auction allowing space to the highest bidders. Of course, the long-term interest of the Anderson School is in taking only those steps that strengthen the school's performance and reputation in a highly competitive MBA market, and even in its self-sufficient/privatized mode, the Anderson School continues to be a part of UCLA and the University of California system.
Would our current system of higher education benefit from aggressive private-sector competition or is the current competition among schools sufficient Explain.