If you spend any time around higher education in multiple countries, you’ll know two things. The first is that public higher education tends to look pretty similar from one country to another. And second, the status of private higher education varies enormously. How big the sector is, the ownership forms, the missions, the delivery modes, can all vary quite significantly.
Private higher education occupies both the top and the bottom of the global prestige hierarchy. At the one end, you’ve got places like Harvard in the United States, or Yonsei University in Korea. And at the other end you’ve got mom and pop for-profit institutions teaching mainly or entirely below the bachelor’s level.
But what’s in between is a pretty rich tapestry, and an important one too. By most counts, private higher education educates about a third of all students worldwide, and is of particular importance in countries where rapidly expanding access is overwhelming traditional public institutions.
With me today to make sense of all this is Dan Levy. He’s Distinguished Professor in the Department of Educational Policy and Leadership at SUNY Albany, and he’s the founder and director of the Program for Research on Private Higher Education, a global scholarly network. Just last year, he released a magnificent book called ‘A World of Private Higher Education‘, and no, I don’t just like it because of the name.
It’s mainly a topology. Which might not sound all that interesting, but given the richness and complexity and variation of the subject, the degree to which the book is both comprehensive and readable is a real achievement. I asked him on the show to see if he could replicate the book’s feat in under 30 minutes, and I think we came close, but I’ll leave it for you to judge. Here’s Dan.
The World of Higher Education Podcast
Episode 4.10 | Inside the Global Private Higher Education Sector with Dan Levy
Transcript
Alex Usher (AU): Before we get into some of the broader themes of your book, I want to make sure we’re all on the same page about what you mean by “private.” Some people use that to talk about privately governed universities, and others mean privately funded universities. There’s a lot of overlap between the two, but it’s not perfect. So when you talk about private universities, what are you talking about?
Dan Levy (DL): Yeah, I think there’s ambiguity in much of the world, but especially in the Anglo world, where there’s been so much “privateness” within universities that are officially, legally public. The way I’ve done it over the years—and continue to do so in my latest book—is to define private as whatever is legally designated as private in the country where the institution operates. And of course, the same goes for public—whatever is legally designated as such. Eventually, whatever the ambiguities inside a country, each country presents its data broken down by private and public to UNESCO. So that’s what we use as the starting point. It’s not perfect, but I’d argue it’s at least as good as any other.
From there, we move to the empirical. I like the word “overlap” quite a bit because we do find tremendous overlap between what is legally private and what we think of as private—but not always. The exceptions make for interesting points of contrast. We’re always interested in exploring the degrees and shapes of “privateness,” and that becomes more subjective. We try to start with an objective, legally based definition, generally related to ownership, and then explore from there.
AU: How big is this sector worldwide? How many students and how many institutions are we talking about?
DL: We don’t have as close an estimate on institutions as we do on enrollments. I think enrollment is the more important indicator anyway. If we’re talking about the total for the world, we’re going by the estimates made by UNESCO, and for 2024, we’re talking about perhaps 268 million students.
They don’t provide an updated estimate for the private share, but if we go with the private share from the most recent year we’ve calculated closely — 2015 — and you and I both believe that the private share has been fairly stagnant, fairly steady at about a third of total enrollment, then we’re probably looking at around 85 million students in private institutions.
The only major estimate I know of for the number of institutions also comes from UNESCO, working with the International Association of Universities, and that’s about 21,000. But that figure strikes me as extraordinarily low — you could reach that number depending on how you count institutions from India alone.
AU: Your book is centrally about how private higher education isn’t a single phenomenon. You have a useful three-part typology of private institutions, adapted slightly from one you created almost 40 years ago when you were studying Latin American higher education.
I want to go through those three types one by one. The first type you talk about is identity-based private higher education. What does that term mean? What kinds of institutions fall into this category?
DL: The identity institution is one that is primarily devoted, in its mission and operation, to promoting or preserving the identity of a group. This is usually a social group, and by far the most common example—both today and throughout history—has been religion. The religious type is overwhelming, but we also see examples of private institutions that serve similar purposes related to gender, particularly for women when they were excluded from public universities, and for different ethnic groups as well.
What I do is make a distinction: to be technically an identity institution, the official written mission of the institution must make identity a very notable pursuit—at least as notable as any other pursuit. So, it could combine religion with academic goals, for example.
Many institutions over the years lose their identity and become what I would call group-related or group-intensive institutions, but not quite identity-based. And of course, these identity institutions, while defined here as private, have prominent public cousins all over the world.
AU: Certainly in Canada, many of our universities started out as religious institutions and more or less stopped being so when they began taking public money in the 1950s and early 1960s. I assume there’s a lot of that kind of shift around the world as well?
DL: Quite a bit. In the United States, for example—and people often don’t realize this—many of the Ivy League institutions were originally religious. You could argue about whether they were truly identity institutions or not, but the point stands: religion was a very big element in what eventually evolved into either secular private institutions, as in the U.S., or into public institutions elsewhere.
AU: The second sub-sector you talk about is what you call elite or semi-elite. By “elite,” you obviously mean places like Harvard and MIT in the U.S., or Waseda and Keio in Japan. But those are fairly rare, right? I guess that’s why you include the semi-elite category as well. Who’s in that group—who’s semi-elite?
DL: Yeah, the semi-elite is really where most of the action is. I have “elite” as a sub-sector of private higher education, but empirically, as you say, it’s almost always what I call semi-elite. I make a fairly simple distinction here: elite refers to institutions that are internationally elite, and as you said, those are extremely rare.
There are some examples in Japan, but the only country that has had a substantial number of truly internationally elite private universities is the United States. It’s part of the exceptionalism of U.S. history and reality. Interestingly, there’s one other country that has reached a point where it has a set of world-class, truly internationally elite private universities equal to its public universities—and that’s South Korea.
But beyond that, only the United States has a clear private lead at the elite level. Once you move past the U.S. and South Korea, there are very few examples elsewhere.
AU: Then the third sub-sector is what you call demand-absorbing institutions. I got the impression from reading that this was mostly a residual category—it’s whatever isn’t elite and whatever isn’t identity-based. It includes a lot of for-profits, but it’s not entirely for-profit. In fact, much of it might be not-for-profit. So where does the term demand absorbing come from, and what does this sub-sector include?
DL: Yes, let me clarify that, because there’s a distinction between the work I did on Latin America 40 years ago and what I’m using now. The term demand absorbing came from the fact that, particularly in studying the developing world—and Latin America was out in front in this—countries were massifying higher education mostly within the public sector. But when the demand for higher education became even greater than the rapidly expanding public sector could or would absorb, even as expenditures rose, governments faced a dilemma.
They were generally unwilling to refuse access to higher education, but neither could they—or wished to—pay for it to the full extent. So they became permissive about allowing private institutions to rise up. These were demand absorbers. They didn’t generally have strong religious or academic missions, but they would at least provide some kind of credential and take in students—whether they graduated them or not.
Over the years, I began using demand absorbing as one type within a broader sub-sector that I call non-elite. That still fits your characterization of it being something of a leftover category—it’s not academically or identity-oriented. But I realized that a good deal of non-elite higher education is not truly demand absorbing, even if it once was. Eventually, in many countries, demand stopped growing so dramatically, and many institutions became, if I might say, rather blah or mediocre. They were taking in students, yes, but needed to do something more.
On the more positive side, some of these non-elite institutions are distinctly job-oriented—however successful or not, that’s what primarily defines how they structure themselves. There’s a particular affinity here with the for-profit model. But many legally nonprofit institutions around the world behave in ways that look a lot like for-profits. That’s another topic unto itself, but I do think for-profit and for-profit-like behavior are especially common in the non-elite sector.
AU: Dan, we talked about institutional types and those three sub-sectors, and I know they’re present pretty much throughout the world—but they’re lumpy. They’re not evenly distributed, and you do get regional patterns. Latin America, as you said, is one pattern. I think you’ve also got others in Africa, Asia, and the Gulf. What can you tell us about those regional patterns?
DL: Okay. Early in the book—in the second chapter—I provide regional overviews so that before we get too deeply into the weeds on types and sectors, we have some general characterization of regions. But I’d say this, and it’s really thematic to the book: although there are regional distinctions, what’s most remarkable to me—and has been over the decades—is how replicable the private patterns are, as well as the private-public patterns.
Private higher education isn’t just one thing, but we see its multiple forms appear again and again in different places, often in remarkably similar or sequential ways. For example, you might see an initial rise of religious institutions, followed by relative secularization, then the emergence of a semi-elite alternative, and finally the overflow into non-elite institutions. We see this sequence in every region.
So as much as I do explore regional differences, they tend to vary over time, and what I’m more struck by—and what I’d like the reader to take away—is that there are, if I can exaggerate just a bit, almost laws of private higher education. These patterns are so repetitive.
I even opened the book with a kind of teasing thought experiment: suppose you were trying to guess what private higher education looks like in Iran. My argument is that if you knew nothing about Iran politically, economically, or theologically, but you did know global private higher education patterns, you’d likely guess more of the right features than if you were the world’s greatest expert on Iran’s political economy but didn’t know private higher education elsewhere. It’s a colorful example, but it shows how pervasive and consistent these global patterns really are.
AU: One thing you mentioned at the start of the program was that about 30% of global enrollment is in the private sector, and that accords with what I’ve seen. What I find interesting, though, is that you said this hasn’t really changed much in the last 20 years or so. Why is that? And might it change at some point in the future—could it go up or down?
DL: Your guess is certainly as good as mine. I usually retreat to multiple reasons for why the private share has stagnated. It’s important to pair that with the fact that private numbers have continued to grow substantially—but so have public numbers. This isn’t the fall of public higher education in terms of size.
When the private share of global higher education was 10%, if it captured 20% of new enrollment, its overall share rose. But once it reached 30–33%, getting that same 20% of new enrollment would actually mean its share decreased. It’s just harder to raise the overall share once you’re already at a certain level.
But there’s also been public responsiveness. It’s fascinating to see, for example, that in Indonesia right now, there’s been a noticeable decline in the private share because public institutions are taking in more students who pay tuition. And we’ve seen this before in many other countries. Public institutions sometimes respond by partially privatizing: they may maintain a small quota for highly selective students who don’t pay, but to make their institutions financially viable—and to fend off private growth—they create a second track for fee-paying students, often offering curricula quite similar to what they’d find in legally private institutions. That’s a kind of pushback effect.
Another factor, at the policy level, is that public authorities sometimes push back by cracking down on the worst of the demand absorbers—closing them down, which reduces private sector size. In many cases, regulations and licensing requirements have become tougher. There’s a natural tendency for public opinion and employers to react negatively to the proliferation of low-quality, demand-absorbing institutions, and governments often respond accordingly.
AU: And yet we have this one part of the world—Western Europe—the most public and most publicly funded higher education systems in the world, where private higher education right now is going gangbusters. Spain and France each have between 25 and 30% of their students in the private sector, which is very close to the American number—about 30%.
Italy’s private share has doubled in the last 10 years. Germany’s has doubled in the last 10 years. And Poland—well, Poland was one of those typical demand-absorbing sectors. You’d assume that once the demographic wave went away, their private sector would shrink—because that’s what happened in Russia and Romania. But in Poland, they’ve bounced back. They’re now at 35%, bigger than they were 20 years ago. What’s driving this growth in Europe specifically?
DL: The answer’s clear: I’m actually a very wealthy man and I’ve engineered all of this to promote my book.
But seriously—if there’s any part of the world you’d think of as the bastion of public universities, and public universities of high quality, it’s Western Europe. So, okay, in Latin America, Africa, or South Asia, you could talk about public universities crumbling and contributing to the growth of private semi-elite institutions—but Germany?
A few years ago, the German government asked exactly the same question you’re asking: How can this be happening here? Our public universities are free. Our private institutions charge tuition. Our public universities are still excellent. So why are more and more students choosing private institutions?
And as the German government would do, it funded 21 research projects to investigate this—what private higher education is, why it’s growing, and what it’s doing. I was invited over to keynote and participate in some of that research, which is still ongoing. One of the messages I brought was that it’s not just Germany—it’s a general pattern across Western Europe.
I think a good deal of this private growth is what I would call product- or job-oriented. What we’re seeing in Western Europe is, unsurprisingly, similar to what you see in the UK and Canada. This brings Western Europe much more into the global mainstream.
If we look at Western Europe as a region, the pattern seems clear: late growth of private higher education, and growth that is overwhelmingly product-oriented. This isn’t a rise of religious higher education, and it’s not primarily a rise of semi-elite institutions—though there’s a bit of that at the very top in Italy, Spain, and the UK. Mostly, it’s job-oriented, non-elite institutions. That’s a big difference from the configuration you see in Latin America.
To me, this shows a very plural market dynamic. Even when parts of the private sector decline—as you’d expect in competitive markets—many private institutions die off and fail. But voilà, new types of institutions emerge, different from the ones before. They create not only new private-public contrasts, but also new private-private ones—ones that none of us geniuses predicted.
AU: Dan, thanks so much for being with us today.
DL: Thank you very much.
AU: It just remains for me to thank our excellent producers, Tiffany MacLennan and Sam Pufek, and of course you, our listeners and readers, for joining us. If you have any questions or comments about today’s episode, please don’t hesitate to get in touch at podcast@higheredstrategy.com.
Join us one week from today when our guest will be Attila Pausits, Head of the Department for Higher Education Research and Development at Danube University Krems in Austria. He’ll be talking to us about one of his major new projects—the Global Observatory of Higher Education Changes and its first annual report. Bye for now.
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