The president, Michael D Higgins, has criticised "many universities" who he says now produce graduates who are "professionals" rather than "critically engaged citizens".
In a speech at Fordham University in New York Mr Higgins accused universities of abandoning their "traditional role" of preparing students to be "thoughtful, conscientious, active citizens".
He said instead they aimed "almost exclusively" towards preparing them for the global marketplace.
In a wide-ranging speech titled "Humanitarianism and the Public Intellectual in Times of Crisis", Mr Higgins also criticised some intellectuals and academics who, he said, had been seduced by a reliance on corporate power or who had "drifted into a cosy consensus that accepts the failed paradigm of society and economy as the only model we have, or might have, of operating internationally".
President Higgins said universities were challenged in "an urgent way" to tackle existential questions, including the survival of the bio-sphere, of deepening inequality, and the misuse of science and technology.
He said there was a real concern that the emphasis on university funding from beyond the state was having a distorting effect on the career structure of scholars, many of whom struggled "under the yoke of a neo-utilitarianism that is bad for scholarship" and bad for society.
President Higgins said he believed that public intellectuals had an ethical obligation as an educated elite to take a stand against "increasingly aggressive orthodoxies" and the "discourse of the marketplace" that had permeated all aspects of life.
He said it could be argued that the role of academics was to have the courage to provoke reaction and to "be subversive of received thought, assumptions, and fallacies".
He also said that if an intellectual's mission in life was to advance human freedom and knowledge, then "this mission often means standing outside of society and its institutions and actively disturbing the status quo."
The president criticised precarious employment practices within universities that led to scholars struggling without security or tenure. He said academics all over the world "should weep for the destruction of the concept of the university that has occurred, which has led to little less than the degradation of learning".
Referring to economic theories that promoted "unrestrained, unregulated market dominance", the president said a "prevailing, largely uncontested paradigm" had emerged and gained hegemony.
He said that paradigm had had consequences for all institutions including universities and the United Nations, and had encouraged an individualism without social responsibility.
President Higgins called on universities to "lead a new paradigm of engagement with the world" and to contribute meaningfully to the discourse on the pressing challenges of the day.