Table of Contents
Universities are at a crossroads. The financial pressures they face are becoming increasingly existential. Institutions once seen as engines of social mobility and global progress now struggle to keep their doors open, fund research, and uphold their missions. Public funding, once the lifeblood of higher education, is drying up and concentrated around top-tier ones (OECD 2024; Zatonatska et al. 2019; Wu 2020). Yet expectations continue to rise: more students, more innovation, more international engagement. How can universities be expected to do more with less, year after year, without compromising the very values they were built to uphold?
This isn’t just a budgetary issue any longer. It has become a question of global priorities. If societies truly believe in the transformative power of education, why is higher education so often treated as a cost rather than an investment? Why are universities forced to chase revenue through tuition hikes, commercial ventures, and donor appeasement, while their core mission—teaching, research, and public service—risks being sidelined?
If societies truly believe in the transformative power of education, why is higher education so often treated as a cost rather than an investment?
The uncomfortable truth is that many institutions are being reshaped not by academic vision, but by financial necessity. This shift has profound implications for international cooperation. Without adequate funding and strategic autonomy, universities risk becoming transactional entities rather than collaborative partners. Moreover, the quality and inclusivity of global research are at stake. The geographical distribution of citations in global science remains heavily skewed toward traditional Western and Westernizing countries, where the most prestigious institutions dominate university rankings (QS 2025, THE 2025, Gazni and Thelwall, 2016). Holding a central position in global collaboration networks is increasingly vital, yet this dynamic disadvantages universities with lower visibility and impact.
Some notable exceptions emerge in university rankings, especially among Lower-Middle and Low-Income Countries such as Azerbaijan, Egypt, India, Nigeria, Pakistan, and Turkey, which have significantly increased the number of their represented institutions in the QS 2026 and THE 2026 editions compared to QS 2020 and THE 2020[A1] [ZK2] [ET3] . Importantly, countries in Central and Eastern Europe like Poland, Czech Republic, Hungary or Romania have also shown a remarkable increase in the number of ranked universities over this period. However, this progress is not universal, as many countries in similar income brackets show limited development, highlighting persistent disparities in global higher education. This uneven “progress” may also reflect structural features of global rankings themselves, which impose competitive hierarchies where gains by some actors do not necessarily translate into overall system-wide advancement.
The funding squeeze and its global consequences
For decades, government appropriations (that is, direct public funding allocated to universities through national or regional budgets) provided the foundation for university operations in many parts of the world. They enabled institutions to pursue long-term goals, invest in research, and maintain academic independence. But this foundation is crumbling. In many countries, public investment in higher education has declined significantly, forcing universities to seek alternative sources of income. This shift has led to a growing reliance on tuition fees, philanthropic donations, commercial ventures, and industry partnerships.
Commercial ventures can be lucrative, but they also pose risks. When financial goals begin to overshadow academic priorities, universities may find themselves compromising on their core mission.
Tuition fees, especially in private institutions, have become a dominant revenue stream (Ritzen, 2021). While they help cover operational costs, they also raise serious concerns about affordability and access. Students and families are increasingly burdened by rising costs, and the promise of higher education as a pathway to opportunity is under threat. Philanthropy has stepped in to fill some of the gaps, supporting scholarships and financial aid (Tierney, 2021). Yet philanthropic support is often concentrated among elite institutions, leaving others behind.
Commercial activities—such as technology transfer, licensing, and auxiliary services—offer another avenue for revenue (Perry, 2023). Commercial ventures can be lucrative, but they also pose risks. When financial goals begin to overshadow academic priorities, universities may find themselves compromising on their core mission.
Endowments provide long-term financial security and enable strategic investments in research, infrastructure, and faculty (Acharya & Dimson, 2007). However, endowments are not evenly distributed. Institutions with long histories and strong alumni networks tend to have larger reserves, while newer or less prestigious universities often struggle to build meaningful endowments. Successful fundraising requires dedicated leadership and sustained effort—resources that not all institutions can afford.
The Matthew effect and the global collaboration divide
The uneven distribution of financial resources has created a stark divide in the higher education landscape. While some universities thrive, others face chronic underfunding and limited opportunities. This is particularly true in developing countries, in Central and Eastern Europe, and among lower-ranked institutions on global university rankings. These universities often lack access to competitive research grants, international partnerships, and high-paying student markets.
This cumulative advantage reinforces existing hierarchies and limits the diversity of perspectives in global research. It also undermines the potential of international cooperation to be truly inclusive and transformative.
This imbalance is intensified by the Matthew effect in scientific collaboration—a phenomenon where established researchers and institutions attract more recognition, funding, and partnerships, while lesser-known counterparts struggle to gain visibility. As top-tier universities dominate citation networks and collaborative projects, others are left on the margins. This cumulative advantage reinforces existing hierarchies and limits the diversity of perspectives in global research. It also undermines the potential of international cooperation to be truly inclusive and transformative.
Should excellence in higher education be confined to a handful of elite institutions? Or can we build a system that allows all universities to succeed and contribute meaningfully to global knowledge production? The growing concentration of wealth and influence among top-tier HEIs threatens the cohesion of the sector and the integrity of international collaboration.
Moreover, performance-based funding models, which tie financial support to metrics like research output and global rankings, can disadvantage institutions that focus on teaching and community service (Jongbloed & Vossensteyn, 2001). These models often fail to capture the full scope of a university’s impact, especially in regions where access and equity are paramount.
Rethinking cooperation and funding models
To shape a more equitable and resilient future for international cooperation in education, universities and policymakers must rethink how higher education is funded and how partnerships are formed. The goal should not be merely to survive but to thrive academically, socially, and globally.
Renew public commitment to higher education
Governments must recognize higher education as a strategic investment in national and global development. Increased public funding can support research, teaching, and infrastructure, while also ensuring that universities remain accessible and capable of engaging in meaningful international partnerships.
Embrace hybrid funding approaches
Hybrid models that blend public and private funding allow universities to diversify their revenue streams while maintaining accountability. These models can strengthen institutional resilience and enable universities to pursue international collaborations without compromising their academic mission.
Encourage equitable collaboration and shared resources
International cooperation should not be limited to elite institutions. Joint research initiatives, shared facilities, and regional consortia can reduce costs and foster innovation across borders. Funding agencies and governments should support inclusive partnerships that bring together institutions of varying sizes, capacities, and geographies.
Innovate financial tools for global engagement
New financial instruments—such as income-contingent loans, social impact bonds, and digital fundraising platforms—can help universities tap into broader funding bases. These tools should be designed to support international mobility, joint programs, and collaborative research, especially for institutions with limited resources.
Strengthen institutional governance and strategic autonomy
Effective leadership and governance are essential for navigating complex funding environments and international partnerships. Universities with greater autonomy are better positioned to make strategic decisions, respond to global challenges, and invest in long-term collaborations.
Keep equity and inclusion at the core
International cooperation must be grounded in equity. This means ensuring that funding models support underserved regions, that collaborative projects include diverse voices, and that access to global networks is not limited by financial constraints. Without deliberate efforts to counteract the Matthew effect, international cooperation risks reinforcing existing inequalities.
Reevaluate metrics and incentives
Global rankings and performance metrics shape institutional behavior and funding decisions. Yet, many of these metrics prioritize research output and reputation over collaboration, teaching quality, and societal impact. A shift toward more holistic indicators could encourage universities to invest in partnerships that advance shared goals rather than individual prestige.
Looking ahead: Cooperation as a cornerstone
The future of international cooperation in education will be shaped by how we respond to today’s financial and structural challenges. Universities must be empowered to collaborate across borders, disciplines, and sectors as co-creators of knowledge and solutions. This requires funding models that are inclusive, sustainable, and aligned with the public good.
Financial autonomy, when exercised responsibly, enables institutions to invest in talent, infrastructure, and innovation (Aghion et al., 2010). But autonomy must be accompanied by accountability and a commitment to equity. The Matthew effect reminds us that without intentional design, collaboration can compound advantage and become exclusionary. To truly harness the power of international cooperation, we must ensure that all institutions—regardless of size, location, or ranking—have the opportunity to participate and lead.
The future of international cooperation in education will be shaped by how we respond to today’s financial and structural challenges. Universities must be empowered to collaborate across borders, disciplines, and sectors as co-creators of knowledge and solutions.
By working together, universities, governments, and global organizations can build a higher education ecosystem that is resilient, diverse, and impactful. In a world facing shared challenges—from climate change to digital transformation—the future of education depends on our ability to cooperate across borders and invest in knowledge as a collective good.
