The Rise of the For-Profit Sector in US Higher Education and the Brazilian Effect


John Aubrey Douglass, Center for Studies in Higher Education, University of California, Berkeley, 771 Evans Hall #4650, Berkeley CA 94720-4650, USA,


What accounts for the rapid growth in the For-Profit (FP) higher education sector in the US? How will its growth influence educational opportunity and degree attainment rates in a country that first pioneered a mass higher education built largely on expanding public colleges and universities? The current US experience is a version of what I call the ‘Brazilian Effect’: when public higher education cannot keep pace with growing public demand for access and programmes, governments often allow FP's to rush in and help fill the gap, becoming a much larger and sometimes dominant provider. This is the pattern in many developing economies such as Brazil, Korea, Poland and other parts of the world. Despite new federal regulations intended to better regulate For-Profits, my prediction is that they will continue to grow over the long-term in the US not so much because they meet societal demands for diverse forms of higher education, but because of the inability of the public sector to return to the levels of public subsidies they had in the past. The result now, and in the future, is a kind of policy default: the future tertiary market will not be the result of a well thought out policy at the national or state levels, but a quasi-free market consequence that will foster lower quality providers and fail to meet national goals for increasing the educational attainment level of Americans. This article discusses how higher education policymaking is about broad issues of socioeconomic mobility and economic competitiveness, but it is also about money, big business, and political influence.