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Street sign that reads "Short Cut Road."

The eyes of the world are on the Karolinska Institute in Stockholm this week for the announcement of the Nobel prize in medicine, but an ugly medical scandal lurks in the background. The case of Paolo Macchiarini involved the deaths of multiple patients and several instances of research fraud, and has exposed the misdeeds of a single professor. But it also demonstrates the risks of academic capitalism: a global trend that turns universities into businesses. In this respect, the story has wider lessons for us all.

As academic capitalism spreads, universities abandon traditional meritocratic and collegial governance to hunt money, prestige and a stronger brand. Here in Sweden, this shift has been especially profound: since the 1980s, the university system has been deregulated, and its core principles gradually replaced by management practices from the corporate world. Government research policy over the past decade has further pushed universities to centralize their strategic management and increase their international visibility. Major strategic funding programmes included one to recruit international star scientists.

An investigation into the Macchiarini scandal, led by a former president of...