For-Profit Education Vs. Non-Profit Education Term Paper


The confirmation that the students who had some sort of shortcoming whether in the financial sector, minority aspect or admittance-timeline factor were the ones who mainly enrolled in the for-profit educational institution was made by Apling and Aleman in a study they conducted in 1990, and Lee and Merisotis in a study they conducted in the same year which were also then matched by Phipps et al. (2000) and JBL Associates (2004).

Grubb was the only researcher who, in the year 1993, explored and assessed the influence and affect of the concept of the industrial market proceeds in relation to the non-profit institutions and education. He assessed and studied the National Longitudinal Study of the H.S. Class of 1972 (NLSY-72) under the OLS regression model and highlighted the income-earning patterns of the non-profit post-secondary graduates and also concluded that there was no significant profits gained by the non-profit institutions for their long-term earnings. In his study, Grubb made no effort to change or approve the prejudiced assortment of the enrolled students. Another aspect that needs to be taken into consideration is that the corporate and global market keeps changing according to the annual fiscal requirements, developing with the innovative changes, influenced by the changing federal laws as well as the market criteria for the provision of the financial assistance and the educational regulations and modifications in the overall structure. So there is no way to determine if the assessments and conclusion made by Grubb are at all relative to the current for-profit educational setup and phenomenon.

St. John, Starkey and Paulsen (1995) with the help of NPSAS 1987 carried out a quantitative analysis, the only of its kind, on the educational consequences in relation to the influence of the financial support provided annually to the diligent and hard-working students of the for-profit institutions. The conclusion made at the end of the study was that the financial aid and assistance provided to the diligent and hard-working students studying under the for-profit educational setup was used extremely constructively and yielded desirable results specifically amongst the African-Americans and Hispanics.

Even though there hasn't been much research done in the past on the authoritative patterns and the basic setup of the for-profit post-secondary institutions, it is however getting its due attention now and more and more studies are being conducted on the concerned topic and its affects overall. Numerous studies are also being conducted on the effect and consequence of the federal financial aid provided to the students enrolling in the for-profit educational setup and its consequences thereof (Cellini 2005). However, irrespective of all that, there are still many dimensions and factors of the for-profit educational structure, institutions, economic/financial setups and students that we are still unaware of.

Statement of the problem

One important factor is the debate currently taking place in the scholarly community about the inadequacy of the traditional educational set up and the controversies surrounding the for-profit education set up. While researchers continue to give their opinions about the kind of educational set up best suited for U.S. (Chung, 2006), they fail to take into consideration the opinion of the students. Numerous research studies have shown the tendency to use technical data (such as age, demographics, annual income etc.) so as to support their argument (Grubb and Tuma 1991; Apling, 1993; Grubb 1993a, b). These studies, however, fail to take the opinions of students who have studied in both forms of educational setups, i.e. traditional and for-profit. Therefore, this study will assess the adequacy of both forms of educational systems, non-profit and for-profit, by taking into account, the opinion of the students who have studied in these institutions.


Civic contributions of students

Peterson, Augustine, Einarson, and Vaughan (1999) in their research reveal that the non-profit education serves the greater public interest because of the contributions made by the students who graduate from institutions. They refer to these contributions as human capital, i.e. economic contributions made by these graduates along with social and non-fiscal contributions, e.g. good parenting, health and security, etc. So, in a way the best way to serve the public interest is to solidify the higher education in such a way that it produces not only good employees but also good citizens. However, OECD (2004) reveals that American graduates are lesser efficient and contribute lesser when compared with their counterparts in


Other researchers too agree with this conclusion (Brewer, Gates, and Goldman, 2002). While it is clear that American graduates do not contribute as much as their European counterparts, difference in attitude towards civic contribution between students who receive education in a non-profit institution against students who receive education in a for-profit institution is not known. In order to assess the benefits of for-profit against non-profit education, it is important that attitude of students in both these institutions be evaluated. We believe that there will be no significant difference in the attitude towards civic contribution between students who receive education in a non-profit institution against students who receive education in a for-profit institution. We base our belief on the study carried out by Dill and Soo (2004) who reveal that inadequate and unauthentic information of the global market and its link with both forms of higher educational setup has decreased the standard of education considerably. Therefore, our first hypothesis is:
H1: There will be no significant difference in the attitude towards civic contribution between students who receive education in a non-profit institution against students who receive education in a for-profit institution.

Financial proportion of for-profit and non-profit educational institution

Studies have shown that financial support to students studying in for-profit education is used extremely constructively and yields desirable results (John, Starkey and Paulsen 1995; Cellini 2005). Funding for the for-profit education has also been on the rise after the commencement of the Higher Education Act (St. John, Starkey and Paulsen 1995). Nonetheless, students studying in for-profit institutions receive a very tiny amount of the federal financial assistance. The attitude of students studying in for-profit institution towards financial aid is still unknown. While the government continues to increase their share on behalf of students studying in non-profit institutions (St. John, Starkey and Paulsen 1995), Phipps et al. (2000) argues that the government should allocate more funds to students in for-profit institutions without decreasing the financial aid of students in non-profit institutions. Based on these studies, we present our second and third hypotheses:

H2: Students studying in for-profit, as well as, non-profit institutions will more likely prefer an increase in allocation of their financial aid without decreasing the financial aid of students in non-profit institutions.

Standard of Job opportunities after Graduation number of research studies have shown that for-profit institutions have increased job opportunities for students (Jackson 1978; St. John 1991; St. John and Noel 1989; St. John et al. 1995). Goodwin in his study (1989, cited in St. John et al. 1995) concluded that the graduates from for-profit institutions were receiving higher hourly incomes than those that graduated from the conventional community colleges or public/private schools. However, other researchers have put forward conflicting results. Lyke, Gabe and Aleman (1991, cited in Grubb 1993a) and Moore and Smith (1992) assert that no significant difference exists in income earnings and job opportunities between students studying in for-profit and non-profit institutions. Therefore, our third hypotheses is:

H3: Students will more likely feel that neither for-profit nor non-profit institution will have any significant bearing on the job opportunities and income level they will receive after graduation.

Aims and objectives behind for-profit educational institutions

Knudsen, Heckman, Cameron & Shonkoff (2006), Phipps et al. (2000) and (Chung, 2006) reveal that for-profit institutions have emerged as a strong alternative because they resort to innovation and creativity and that traditional education lacks this structure. With the global dynamics shifting towards cut-throat competition, innovation and creativity are the current buzz words in the real world. Students have got to be equipped with these tools so as to lead others into the future (Phipps et al. 2000). Researchers have ignored to seek opinion of students in these institutions. Nonetheless, based on the aforementioned study, our forth hypothesis is:

H4: Students studying in for-profit institution are more likely to have higher confidence in their creativity and ability than students studying on non-profit institution.

Aims and objectives behind non-profit Educational institution

Dill (2001) asserts that one of the main aims of all the conventional universities and institutions is to make as much profit as possible and widen the gap between revenue and expenditure. He further asserts that the concept of common good is fast declining and the government needs to take control before the global dynamics leave the higher education system behind. Opinion of students in these institutions has been ignored by researchers. Nonetheless, based on the aforementioned study, our fifth hypnotizes is:

H5: Students studying in both non-profit and for-profit institutions will feel that public universities are not focused towards delivering common good and increasing the standard of overall education and instead are focusing on increasing their profits.

Criterion of Admission

Brewer, Gates, and Goldman (2002) assert that the common denominator between the public and private institutions in America was…

Sources Used in Documents:


Altheide, D.L., & Johnson, J.M. (1994). Criteria for assessing interpretive validity in qualitative research. In N.K. Denzin & Y.S. Lincoln (Eds.), Handbook of qualitative research (pp. 485-99). Thousand Oaks, CA: Sage.

Apling, R. & Aleman, S. (1990). Proprietary schools: a description of institutions and students. (Report No, 90-428EPW). Washington, DC.: Library of Congress, Congressional Research Service.

Apling, R. (1993). Proprietary schools and their students. Journal of Higher Education 64:4, pp. 379-416.

Barone, T.E. (1992). Beyond theory and method: A case of critical storytelling. Theory into Practice, 31(2), 142-146.
National Association of State Universities and Land-Grant Colleges (NASULGC) (1999) About NASULGC. Retrieved 12 April 2005 at

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