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While American institutions of higher education still lead the world in quality of instruction, research and service, certain trends are challenging their future. Immediate attention to resolving these issues is necessary if the American university is going to maintain world leadership in the foreseeable future. The theory of transactional distance is put forward as a roadmap for changing the industrial system of education to a post-industrial one in which each learner receives differential instruction based on his or her prior knowledge of the subject matter, learning preferences and metacognitive states. Management of learning and teaching is described in a dynamic environment in which learners can participate in defining the level of autonomy with which they are comfortable, and instructors can set the required level of structure according to the characteristics of each discipline taught thus providing the appropriate level of transactional distance at each point in time for each individual learner. Ramifications of this environment for the structure of the university are discussed and components of a future educational management system are specified.

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