The Complicated Relationship Between Universities and Industry: Exactly as it Should Be

The relationship between universities and industry has played a crucial role in advancing society and shaping better communities worldwide. However, this commentary argues that explicit tensions between university research and industry have, at critical junctures in history, disrupted and redirected industrial and capitalist inclinations on a global scale. Some of these disruptions were technological (such as the development of the internet), while others were ethical (corporate social responsibility), moral (child labour laws), societal (universal healthcare and education), or scientific (anthropogenic climate change).

Around the mid-twentieth century, neoliberal perspectives on universities—rooted in the idea that universities should primarily serve economic and industrial interests—began to emerge, championed by thinkers such as Hayek, Friedman, and Von Mises. However, a key criticism of neoliberalism is that it fails to reflect the broader scientific, technological, social, moral, and ethical transformations that university-led research has enabled.

The Humanist and Classical Perspective on Universities

The humanist and classical perspective on universities can be traced back to Aristotle’s Nicomachean Ethics, where he introduced the concept of eudaimonia, often translated as “well-being” or “flourishing.” Aristotle argued that what distinguishes humans from plants or animals is our capacity for rational activity—thinking, reasoning, and making ethical choices. He contended that education should cultivate virtue, critical thinking, and intellectual curiosity. Contrary to some interpretations of happiness, eudaimonia is not about hedonism (pleasure) or capitalism (wealth and power) but about living in accordance with virtue and reason.

In the early 19th century, Wilhelm von Humboldt developed the Humboldtian model of higher education, which shaped the modern university system. He emphasised the unity of research and teaching, academic freedom, and the development of individual character through self-directed learning. Similarly, Immanuel Kant advocated for the pursuit of knowledge for its own sake, rather than as a mere instrument for economic ends. From this perspective, universities should cultivate rational, autonomous individuals capable of ethical reasoning and capable of transforming society in sustainable, moral, and ethical ways.

Critical Perspectives on Universities Serving Industry

From a critical perspective, Karl Marx and others have argued that universities serving industry reflect capitalist hegemony, wherein education becomes a mechanism for maintaining the power of the ruling economic class. In this view, universities function primarily to produce workers trained to serve capital rather than independent thinkers who might challenge existing societal structures.

History is replete with examples of how universities have challenged economic and social structures, leading to significant transformations. From the Industrial Revolution to the civil rights movement and climate action, independent thinkers have driven change. Thinkers such as Theodor Adorno and Herbert Marcuse from the Frankfurt School, as well as Paulo Freire, emphasised the role of education in creating graduates who actively participate in shaping society rather than merely serving existing industrial interests.

The Postmodern Challenge to the University-Industry Relationship 

As a young student in the late 1980s, I attended a lecture by the postmodern philosopher Fredric Jameson (Duke University). He argued that university faculties and hyper-specialised disciplinary structures lead to intellectual fragmentation, weakening interdisciplinary connections and diminishing critical holistic thinking. Thirty years later, and from within academia, we had come to realise that universities were indeed no longer functioning as cohesive intellectual spaces. We were experiencing what Jameson described as the loss of “grand narratives” and the commodification of knowledge and culture in late capitalism.

Universities responded by transforming their structures—negotiating common values to guide practice and resources—and establishing multidisciplinary centres to collectively tackle grand societal challenges. Celebrated postmodern thinkers such as Michel Foucault and Jean-François Lyotard questioned the notion of who determines what knowledge is valuable. If universities exist solely to serve industry, does this restrict the scope of inquiry, potentially excluding fields such as theoretical sciences, the humanities, the arts, and critical disciplines that challenge power structures? Jacques Derrida argued that universities should remain spaces of open-ended inquiry, resisting reduction to economic or political interests.

Universities as Drivers of Fundamental Knowledge and Innovation

Despite shifting ideological perspectives, universities have remained cornerstones of intellectual, social, and economic development for over a thousand years. Academics—mathematicians, philosophers, and scientists—are driven by the pursuit of knowledge and the need to question existing paradigms. Postmodernism’s rejection of teleological thinking is at least defensible in the context of university history: knowledge does not follow a fixed direction, and progress is not inevitable. 

Universities continue to drive fundamental knowledge production. Quantum mechanics (which led to semiconductors and computing), the discovery of DNA structure (which revolutionised medicine and biotechnology), and Einstein’s theory of relativity (which underpins GPS technology) are just a few examples of groundbreaking discoveries that originated from university research rather than immediate industrial needs. 

Likewise, innovation often precedes demand rather than merely responding to it. The development of the internet, for instance, was born from academic research (ARPANET) long before commercialisation. Universities do not merely react to industry needs; they create new markets by producing knowledge that leads to entirely new industries.

Many transformative discoveries arise from cross-disciplinary research within universities. CRISPR gene editing, for example, emerged from microbiology research and has since impacted medicine, agriculture, and biotechnology in ways that industry alone could not have anticipated. Universities foster these interdisciplinary breakthroughs, demonstrating their broader societal contributions beyond corporate interests.

Universities as Cultural and Civic Institutions 

Higher education institutions foster critical thinking, creativity, and ethics—qualities that are essential yet not always immediately valued by industry. Universities produce artists, writers, philosophers, and social scientists who contribute to cultural and societal development beyond economic measures. They are cultural and intellectual hubs that have shaped the lives of impactful citizens across the globe.

Furthermore, universities play a vital role in fostering democratic engagement. They cultivate informed citizens who contribute to governance, civic life, and policymaking. Public policy research and social sciences influence how societies govern themselves and address complex issues such as climate change and inequality. Education serves a purpose beyond mere employment; it is foundational to active citizenship.

The Relationship Between Universities and Industry: A Necessary Complexity

Government and philanthropic funding support universities precisely because their discoveries benefit humanity, not just corporate interests. The COVID-19 vaccines, for example, were developed through decades of university research into mRNA technology, with prior trials conducted on Zika, influenza, and polio—largely funded by public institutions. Public investment in universities benefits society at large, rather than merely serving industry.

In fact, universities often challenge industry rather than simply serving it. Academic research frequently holds industries accountable, producing studies on environmental impacts, corporate ethics, and labour rights. Climate science research within universities has challenged fossil fuel industries and driven global environmental policy while simultaneously revolutionising clean energy production and distribution.

Globally, cooperative research programmes between universities and industry have delivered significant societal benefits. Structurally, most universities have dedicated services that foster industry engagement, manage research consultancies, and assist in the commercialisation of research and development. Additionally, universities have established innovation and entrepreneurship ecosystems that support start-up incubation for students and faculty. Informally, numerous discoveries transition into products, services, methods, and policies through the dissemination of research, industry networks, and the efforts of scientists who overwhelmingly aspire to serve humanity and the planet.

However, universities do not, have never, and should not exist solely to serve industry or economic outcomes. They are not merely pipelines for industry but institutions that shape the future through innovation, knowledge production, and societal development. Industry and society are more innovative, productive, equitable, and sustainable because universities have consistently resisted neoliberal pressures to serve purely economic interests. History has overwhelmingly vindicated this stance.

The relationship between universities and industry is complex—and that is exactly as it should be.

Classical and Enlightenment Philosophers

Aristotle. (c. 350 BCE) Nicomachean Ethics. Translated by Terence Irwin. Indianapolis: Hackett Publishing, 1985.

Humboldt, Wilhelm von. 1810. On the Spirit and the Organisational Framework of Intellectual Institutions in Berlin. Berlin: Prussian Ministry of Education.

Kant, Immanuel. (1781) 1998. Critique of Pure Reason. Translated by Paul Guyer and Allen Wood. Cambridge: Cambridge University Press.

Kant, Immanuel. (1798) 1979. The Conflict of the Faculties. Translated by Mary J. Gregor. Lincoln: University of Nebraska Press.

Marxist and Critical Theorists

Adorno, Theodor W., and Max Horkheimer. (1944) 2002. Dialectic of Enlightenment. Translated by Edmund Jephcott. Stanford: Stanford University Press.

Freire, Paulo. (1968) 2000. Pedagogy of the Oppressed. Translated by Myra Bergman Ramos. New York: Continuum.

Marcuse, Herbert. 1964. One-Dimensional Man: Studies in the Ideology of Advanced Industrial Society. Boston: Beacon Press.

Marx, Karl. (1867) 1990. Capital: A Critique of Political Economy, Vol. 1. Translated by Ben Fowkes. London: Penguin Classics.

Marx, Karl, and Friedrich Engels. (1845) 1970. The German Ideology. Edited by C. J. Arthur. London: Lawrence & Wishart.

Postmodern Thinkers

Derrida, Jacques. 2001. The University Without Condition. Translated by Peggy Kamuf. Stanford: Stanford University Press.

Foucault, Michel. (1969) 2002. The Archaeology of Knowledge. Translated by A. M. Sheridan Smith. London: Routledge.

Foucault, Michel. (1975) 1995. Discipline and Punish: The Birth of the Prison. Translated by Alan Sheridan. New York: Vintage Books.

Jameson, Fredric. 1991. Postmodernism, or, The Cultural Logic of Late Capitalism. Durham: Duke University Press.

Lyotard, Jean-François. (1979) 1984. The Postmodern Condition: A Report on Knowledge. Translated by Geoff Bennington and Brian Massumi. Minneapolis: University of Minnesota Press.

Neoliberal Thinkers

Friedman, Milton. (1962) 2002. Capitalism and Freedom. Chicago: University of Chicago Press.

Hayek, Friedrich A. (1944) 2007. The Road to Serfdom. Chicago: University of Chicago Press.

Mises, Ludwig von. (1949) 1996. Human Action: A Treatise on Economics. San Francisco: Fox & Wilkes.