When higher education wants to talk about itself in positive terms, the story it likes to tell is a story like the one of Stanford University in Palo Alto, California. You can read about Stanford’s history in books like Annalee Saxenian’s Regional Advantage and to a lesser extent Rebecca Lowen’s Creating the Cold War University: The Transformation of Stanford. The story goes something like this: “we do lots of great scientific work here, and businesses interested in our Intellectual Property and our talented graduates flock to the area to be close to it all. That’s how we have a positive impact on our communities. Growth! Prosperity! Etc.!”

It’s a useful narrative if you can persuade anyone of its validity. But it’s not higher education’s only economic development story. The other story is that of Ball State University. If you’re like most people, you’ve probably never given a lot of thought to the history of Ball State University in Indiana. But you should: it’s a story which explains a lot of higher education.

Back in 1917, a private teaching school in Muncie, Indiana failed. A local industrialist, George Ball, bought the land and donated it to the state on the promise that Indiana would open a branch of the State Normal School there. Why? Because Ball owned a lot of land in that particular part of Muncie. And sticking an institution of higher education in that part of town was a way to make sure that its neighborhoods possessed a certain sophistication. The Balls also stuck a hospital nearby for good measure and the city stumped up some cash for an art gallery. Professional families moved in;  property values rose. The Ball family made out very well, but so too did the City of Muncie.

The true value of Ball State, in other words, lay in its effect on local property values. The kinds of graduates it produced was irrelevant. It benefits the community by being a good neighbour, by raising property values, by educating local citizens at low cost (in the sense that if it did not exist, local students would have to travel to go to school). At best, it serves as a utility for the local community. Or, alternatively, an “anchor tenant.”

Now, here’s a question: how many Canadian universities are Stanfords, and how many are Ball States?

When HESA does strategic planning exercises, we often ask a very specific question: “if this faculty/institution got hit by an asteroid tomorrow, who would care or be most affected, and why?” We ask it to get people thinking about who their most important stakeholders are and how the institution serves those stakeholders.

Very often, what we hear is “local businesses who rely on our students for business,” or “local families who rely on us for easy access.” In other words, there are a lot of institutions who think of themselves in utility/ anchor-tenant terms rather than in terms of attracting investment and acting as a talent magnet.

Now, that’s not necessarily a bad thing: utilities and anchor tenants have a role to play in the higher education eco-system. But trying to use the same narrative to pump up all of post-secondary education is a fool’s errand. Different institutions serve different purposes and pretending that the Stanford narrative works for everyone is ludicrous.

Why do I raise all this? Well, because of a new paper by Ashish Arora, Sharon Belenzon, Larisa Cioaca, and Hanzen Zhang (all from Duke University) and Lia Sheer from Tel Aviv University entitled “The Effects of Public Science on Corporate R&D” published by the National Bureau of Economic Research and which was profiled in the Economist last week. Broadly speaking, the argument is this: back in the 1950s, basic science was still led by major corporations (e.g. Bell Labs, Dupont), The reason for this, according to the authors, was the existence of some pretty tough anti-monopoly laws which made it difficult for acquire patents via acquisitions. As anti-monopoly laws loosened, and public funding for university science rose, big companies pulled back from spending their own money. But the result in part was that basic science had ever-less connection with commercial applications. When big breakthroughs did happen in universities, they did not get picked up by corporate labs (many of which had by this point been shuttered) and overall patent production—a reasonably good proxy of product innovation—suffered.

Now whether this story is a failure of universities or not is a matter of debate. Personally, I think you can argue this as a story of corporate short-sightedness as easily as one of higher education haplessness. But at the very least what it tells you is that the innovation ecosystem of today is probably not optimally-suited to delivering economic growth. You don’t have to get into any finger-pointing about which side is at fault: the point is that universities and business have trouble listening to each other and partnering with each other. It means science funding—whether public or private—is simply less efficient than it used to be. This might explain why new university-led techopolises—places like Sophia-Antopolis, Silicon Valley, Austin, the North Carolina Research Triangle—have become much less common since about 1990 than they were in the period 1960-90. Even if some universities are Stanfords, it seems like we aren’t making new ones like we used to.

In any event, my point here is that the “universities invent the future” narrative, the one that suggests that they drive local technological development, that they are all local Stanfords, is nonsense. The majority of universities are actually Ball States: anchor tenants which provide utility services to the local communities. There’s nothing wrong with that. The World Needs Ball States. It’s just that what is required to make a Ball State effective is different from what is required to make a Stanford effective. One is about service, specifically local. The other is about inventing the future, an inherently global task. Both have important roles in the system.

But we should probably pay more attention to these differences in the way we structure and fund our higher education systems.