Adam Smith Institute

34. "Education is a right, not something to be bought and sold."

Education is bought and sold. It costs money to produce, because resources and personnel have to be allocated to its supply. The question is not whether it should be bought and sold, but whether government should have a monopoly on the transaction.

Education has to be paid for, and people have to be directed to the production of it. This can be done, albeit inefficiently, by having government decide on the appropriate level, and by levying sufficient taxation to pay for it. Education then takes its place in the queue of demands on public funds. Extra allocation depends on political pressure, and what level of taxation the government thinks will be tolerated. It also depends on the level of public outcry at the standards which the state manages to achieve.

Alternatively it can be provided in a market way, with people spending on it what they think it is worth, and to the level which they think is advantageous. People engage in supply activity to meet, and even profit from, that demand. A wide range of choices is available for a range of widely different personal circumstances. In both cases it is a commodity, not a right. People have a scale of priorities; they have to balance how much they care to spend on housing, how much to other things such as consumer goods and holidays, and how much to personal services such as health and education. This is done very diffusely and imperfectly through the political process, where individual preferences have to be averaged.

People may decide that in a humane society, everyone capable of benefitting from education should have access to it at appropriate levels. Instead of being done through mass state provision, this can be achieved by ensuring that affordable school places are widely available, and by helping where necessary through vouchers or assisted places.

...Those who can't, teach.

Sir Roderick Floud, former vice-president of the European University Association, said the UK was a clear market leader in higher education in Europe, which by 2010 would offer a potential market of one billion people as a result of the Bologna Agreement, designed to unify higher education systems across the continent.

"I find it completely extraordinary and short-sighted that British universities are so well represented in recruitment terms in south Asia and the Far East, and so badly represented in the rest of Europe," Floud told the Guardian's Higher Education summit in London.

These fees from overseas students have in fact been the lifeblood of the entire sector for some years now: possibly a third of the entire fee income of the whole higher education sector. This isn't extraordinary nor is it short-sighted: it's simple economic rationality.

A market of one billion people in a population of just under 500 million also looks a bit of a stretch.

So does the phrase finish with "those who can't teach, administrate"? 

The future of medicine lies in the hands of researchers, doctors, and most importantly – private funders.

Imperial College London's Institute of Biomedical Engineering (IBE) was founded in 2004, the first of its kind in the UK. Recently profiled in the Financial Times, it serves as a model for other institutions. Gone is the day that University researchers fear commercial involvement in their work, for as the FT put it:

IBE staff have been enterprising not only in spinning out companies – seven so far – but also in raising money to build and run a postgraduate research institute at the heart of Imperial's South Kensington campus. A particularly innovative feature of IBE's £28m fundraising was the £10m invested by the Esmée Fairbairn Foundation, a charity that focuses on culture, education and the environment.

Although this foundation is a charity, the investment was purely commercial. In return, any future spin-outs or licensed agreements have a portion returning to the Foundation. Rather than relying on government funding to raise money for big capital projects, some universities also have similar deals with financial institutions.

Successful biomedical engineering programs require excellent medical schools and engineering programmes – and also private funding. This is exactly what the Johns Hopkins University has, and being the top BME programme in the US with nine spin-out companies, one can see why.

The Whitaker Foundation, established in 1976, supported the enhancement or establishment of educational programmes in biomedical engineering, especially encouraging the formation of departments. Over 30 years it has given $805 million in funding to institutions like Johns Hopkins. It is private donations such as these have made the US a world leader in this field.

Oxford University has recently launched its own IBE with a similar structure of private funding. As an alumnus of Johns Hopkins BME and a current Imperial IBE student, I’ve benefited from this structure. Other universities should follow suit and create similar opportunities, allowing a higher standard of education for more students.