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This essay hopes to respond to Marginson and Yang's article through an examination of Hu Shih's relevant ideas with an objective to reveal China's unique understanding of universities, private goods and public goods during the Republic of China. Marginson and Yang argued that the discussion of ‘public goods', ‘private goods', and ‘common goods' of higher education should not be separated from the political, social and cultural background in which higher education is embedded, and should be fully integrated with one society's definition of these terms. They pointed out that Chinese culture has its own unique understanding of the relation between individuals, universities, private goods and public goods. China has a long tradition of higher education, but ‘modern' universities only appeared in China in late nineteenth century as a product of transplantation from the West. In the early days, there were rarely research activities at these universities. Chinese modern university that combined teaching and research took shape in the next 30 years since the Republic of China’s founding in 1912. To unpack the Chinese understanding of universities, private goods and public goods, it is necessary to go back to this period (1912–1949) and analyse how the academic elite at that time understood these issues.

Chinese University Builders on the relation of private goods, public goods and higher education: the case of Hu Shih