"Honours without profits?"

[applegrove]

Honours without profits?

the Economist

http://www.businessinsider.com/honours-without-profits-2013-6

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But a damning report on America’s for-profit higher-education firms, issued last year by a Senate committee, helps to explain the suspicions about the deal. It found that such institutions got $32 billion of student aid from the government in the 2009-10 academic year. They charge higher fees than state universities but spend less on teaching. Their drop-out rates are alarming: in 2008-09 the median student lasted just four months.

Laureate already has a similar arrangement in place with the University of Liverpool, a well-regarded British institution. Besides running Liverpool’s online programmes, it has opened a campus for the university in China that now accounts for around a quarter of its enrolments.

Laureate owns or partners with 70 institutions around the world, with 800,000 students enrolled on its courses. Many are in emerging markets—including 11 in Brazil—where they often outperform pallid state-run competitors and help to widen access to higher education. For this reason, in January the International Finance Corporation, the commercial arm of the World Bank, invested $150m in Laureate shares.

Like many American colleges, Thunderbird is short of cash. Enrolment on its $67,000 full-time MBA programme is down from over 1,000 students in 2001 to just 142 this year. Despite a wealthy alumnus donating $60m in 2004, the school’s endowment fund is just $27m, a puny sum compared with others’ war chests: Harvard Business School’s is $2.7 billion.



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