Privatizing Higher Education in Spain

10 Pages Posted: 17 Apr 2005

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The Spanish university system has witnessed many changes in the last thirty years. Initial conditions for competition were laid down in 1983, specially through the recognition of legal status to private universities. However, the shortage of students since 1998 and the drop on demand for higher education (aggravated by the extraordinary increase in offer, as the number of universities more than doubled since 1982) has prompted further reform in the last few years. A new regulation was enacted in 2001 in order to force market-like behavior and to privatize some operating conditions of state universities (free choice of university by students, hiring policies, quality assessment and accountability to the public, allocation of research funds and rankings). Although it might be too early to assess the effectiveness of these changes, public funding remains mostly unchanged and this is a key issue that would need to be modified in order to provide conditions of authentic competition in the higher education industry.

Although the market has been introduced in the provision of higher education in Spain, endless (almost) public funding of state universities is a powerful distortion preventing the development of a truly competitive and fair market.

Keywords: Higher Education, Universities, Spain, Public Goods, Economics of Education, Privatization, Private Universities, Competition

JEL Classification: H42, H52, I21, I28, L33, L43

Suggested Citation

Marcos, Francisco, Privatizing Higher Education in Spain. Available at SSRN:

Francisco Marcos (Contact Author)

IE Law School ( email )

Castellón de la Plana 8
Madrid, Madrid 28006

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