Abstract
This paper argues that the concept of Information Society fails as theory because it is internally incoherent and unsupported by evidence. Its current popularity within policy discourse can only be understood ideologically. In particular it is argued that one of the drivers of current policy towards higher education is based upon the supposed growth of knowledge work linked to a theory of human capital formation as crucial to international competitiveness and to an explanation of unemployment in terms of a skills gap. The paper goes on to argue that current labour market indicators and research into the skills gap do not support this policy thrust and that a better explanation of the current push towards the creation of virtual universities is the desire to cut educational labour costs rather than to upgrade the economic status of so-called knowledge workers.

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