Not-for-profit or for-profit? Research on the high-quality development path of private universities in China based on system dynamics

Private universities play an important role in many countries worldwide. Approximately one-third of university students worldwide are enrolled in private universities. In countries with a large proportion of private universities, the quality of private universities determines the quality of higher education in the country as a whole. In some developed countries, the quality is high; however, in most developing countries, the quality of private universities is significantly lower than that of public universities. In many countries, private universities are managed in either a “not-for-profit” or a “for-profit” manner. The management type of private universities that best supports high-quality development has become an important issue in the field of higher education in many developing countries, but there are only a few related quantitative studies. Taking one private university in China as an example, this study aims to reveal the path that best supports high-quality development for a private university regarding the choice between the not-for-profit and for-profit orientations. Based on a literature review, a system dynamics model of development for private universities is developed, and the case data are simulated and analyzed based on the model. It is concluded that the rapid development path with a not-for-profit orientation, which enjoys government financial allocation, is more conducive to the high-quality development of private universities. Finally, the study proposes the strategies of encouraging private universities to choose the not-for-profit orientation, increasing government investment in not-for-profit private universities, and strengthening the financial supervision of not-for-profit private universities to promote their high-quality development.