Wilson Center Experts

November 1998 - Structural reform of higher education in Eastern and Central Europe since 1989 has been driven by the conviction that the university and academic research institutions inherited from the Soviet system are both economically inefficient and out of touch with society's needs. Leszek Balcerowicz, Poland's finance minister, expressed this view in a 1994 lecture, proposing the market as both the instrument of change and the standard by which innovation ought to be judged. He advocated an educational and research system in which informed decisions, translated into demand (with actors paying for goods), result in a self-regulating mechanism that sustains consistent growth and development. In education and research, this means that "demand" by students and beneficiaries of research freely seeks optimal sources of "supply" (educational and research institutions, whose continued survival depends on success in attracting and satisfying demand). Balcerowicz excluded fundamental research from his considerations, noting that, because its producers and consumers are the same, it cannot be analyzed in market categories. more