Roger Brown: Do we need to have world-class universities?

There is much talk about the need to establish "world class" universities. Some believe that the Government has a covert plan to create them by further concentrating public funding for research in traditional universities, while allowing them to charge what they like by raising the cap on tuition fees. All this, they say, will allow our universities to compete with the American institutions that dominate the international league tables. But what exactly is a "world class" university, and what advantages do they bring to the countries in which they are located and, indeed, the wider international community?

There appears to be no universally agreed definition. But there are certain universities that, because of their reputation and status, attract significant numbers of the world's best scholars and students. In Britain, Oxford and Cambridge fall under this heading, and so does Imperial College and, in a narrower field, the London School of Economics. Apart from America, most other major industrialised countries have only a few or none.

These world-class universities share four characteristics. The great majority are American, reflecting the size and competitiveness of the American economy and the unique combination of public and private funding that characterises the higher-education system in the States – which it will take most other countries decades to emulate, if they ever do.

Second, except in America, and to some extent Japan, these are public universities, and even in America, the private institutions would not be where they are now without massive public support for teaching and research. Their relative positioning reflects mainly their performance in research, especially in the applied sciences and medicine. There are as yet no "world class" teaching universities, nor are there likely to be, given the apparently insuperable difficulty of finding valid measures of teaching quality. And they are a very stable set: it is hard for less-favoured institutions to attain this status (which doesn't, of course, stop them trying).

Does it matter if a country has only one or no such universities? Are countries without them condemned to permanent second-class status? The relish with which ministers and others talk about the UK punching above its weight in research suggests that it doesmatter. Perhaps countries need "world class" universities in the same way that, in former times, they needed a national airline or a battleship. More seriously, it can be argued that such institutions provide a model for others to aspire to.

But there is another side to the picture. For a start, world-class universities, like national airlines and battleships, are expensive. Because, at least in the short to medium term, the necessary resources can only come from the taxpayer, and because the national budget for higher education is likely to remain under pressure for the foreseeable future, this must mean funding being diverted from less favoured, but perhaps more socially useful, institutions.

Equally seriously, the promotion of such universities feeds the academic "arms race" for prestige, which is taking American higher education out of the range of many low- and even middle-income families, and which serves as an awful warning to those who favour raising or even removing the fee cap here.

There are even wider issues. Virtually all of these institutions are in industrialised countries. What chance does the average developing country stand of having a world-class university when, inevitably, its brightest and most ambitious academics and students are attracted to the prestigious and wealthy academic powerhouses of the West? Doesn't globalisation in higher education, as in so many spheres, simply mean that the rich get richer and the poor get poorer?

It must be admitted that ministers face a dilemma here. There can be little doubt that Oxford and Cambridge in particular confer a prestige on the UK that would otherwise not be there. Rightly or wrongly, these institutions feel that they need more resources to compete with the leading American ones (although Oxford's overall level of funding per student is already over four times that of my former university, Southampton Solent).

There is a considerable risk that, if the Government does not give way, they will go private, detaching them even further from the state system and creating an even bigger gap in resources and prestige between them and other members of the Russell Group. Personally, that is a risk I would be prepared to take, but ministers may not be.

The writer is professor of higher-education policy and co-director of the Centre for Research and Development in Higher Education at Liverpool Hope University