This paper analyzes and compares two 1994 reports on the state of higher education in developing nations, the World Bank's "Higher Education: The Lesson of Experience" and the United Nations Educational, Scientific, and Cultural Organization's (UNESCO) "Policy Paper on Change and Development in Higher Education." It examines the assumptions, diagnosis, and prescriptions of each report, noting that both stress the importance of linking higher education with economic development, an important role for government, the building of policy consensus among the various stakeholders in higher education, and institutional reform and autonomy. While both reports stress the importance of linking higher education with economic development, the UNESCO document is clearly much more optimistic in its expectations that higher education can face more complex demands in the social, cultural, and economic spheres. In the World Bank report it is noted that universities should adapt to a competitive market situation, whereas the UNESCO report underlines a more complex idea of institutional adaptation to various demands. Whereas the World Bank report states that basic education should be the priority of developing nations, the UNESCO report refuses this kind of tradeoff within the educational sector, the paper concludes. Contains 10 references. (MDM)