ABSTRACT
The American university is the only institution of higher education to integrate the ideas of Smith and Humboldt. This integration is an important innovation because, while both sets of ideas are essential, they are also limited and in conflict. Smith emphasized the need for institutional competition to keep universities striving for improvement and as a check on professorial opportunism. But to do so he wanted to rely chiefly on a one-sided monitoring regime anchored in students’ voting with their feet (by exiting professors’ courses whose instruction they did not like). Humboldt wanted to create a community of scholars in which not the dispensation but the love and search for knowledge would be the organizing principle, but he was unable to shake the university’s dependence on the state in such crucial matters as funding and hiring of faculty.
