The Research On Private Capital Investment In Higher Education

To quote the Guidelines for Reform and Development of Chinese Education System: In today's world, the political changes are uncertain, the international competition becomes increasingly fierce, and the development of science and technology is rapid. In fact, the worldwide economic competition, and competition of overall national strength is, in essence, the competition of its science and technology and the national quality. In this sense, the country mastered the 21st century-oriented education, will be in advantage during the international competition in the 21st century. The above conclusion is very insightful. However, China's situation is "poor country providing grand education." On one hand, despite the increased enrollment year after year, the number of people who need higher education is still increasing, and the investment in a single mode cannot meet people's growing spiritual and cultural needs. On the other hand, with the economic development of socialist market and the rapid accumulation of social wealth, a huge amount of private funds are available. This provides the necessity and possibility for private capital investment in higher education.In this study, after the analysis of the higher education product attributes, and the analysis of private capital investments in higher education base on both the theory and empirical study, we get several insights: Educational products not only benefit the public welfare, but also has its own profitability; Higher education is a industry for the development of human resources, and improving the production capacity. By sponsoring education, private capital has a special contribution to the community. First of all, the author provided a theoretical analysis of the higher education industry market operation, and clarified some of the confusions. Secondly, the author provided the analysis of the current challenges of the higher education industry, including the institutional shortcomings of public schools and the difficult conditions faced by the private schools. It concludes that: the relationship between higher education institutes and the studies is a commercial relationship of the service provider and service consumer, which influenced by the supply and demand. Based on this, it is recommended to strategically relocate the public investment in higher education and privatize the public schools and build the system for diversified investments in higher education to achieve the change from "national public model" to the "social private model".