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The governance and performance of universities: evidence from Europe and the US

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  • Philippe Aghion
  • Mathias Dewatripont
  • Caroline Hoxby
  • Andreu Mas-Colell
  • André Sapir

Abstract

"We test the hypothesis that universities are more productive when they are both more autonomous and face more competition. Using survey data, we construct indices of university autonomy and competition for both Europe and the United States. We show that there are strong positive correlations between these indices and multiple measures of university output. To obtain causal evidence, we investigate exogenous shocks to US universities' expenditures over three decades. These shocks arise through the political appointment process, which we use to generate instrumental variables. We find that an exogenous increase in a university's expenditure generates more output, measured by either patents or publications, if the university is more autonomous and faces more competition. Exploiting variation over time in the 'stakes' of competitions for US federal research grants, we also find that universities generate more output for a given expenditure when research competitions are high stakes. We draw lessons, arguing that European universities could benefit from a combination of greater autonomy and greater accountability. Greater accountability might come through increased reliance on competitive grants, enhanced competition for students and faculty (promoted by reforms that increase mobility), and yardstick competitions (which often take the form of assessment exercises)." Copyright (c) CEPR, CES, MSH, 2010.

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Bibliographic Info

Article provided by CEPR & CES & MSH in its journal Economic Policy.

Volume (Year): 25 (2010)
Issue (Month): (01)
Pages: 7-59

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Handle: RePEc:bla:ecpoli:v:25:y:2010:i::p:7-59

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Cited by:
  1. Guccio, Calogero & Martorana, Marco & Monaco, Luisa, 2013. "Evaluating italian university teaching efficiency convergence: a non-parametric frontier approach," MPRA Paper 56673, University Library of Munich, Germany.
  2. Eric A. Hanushek & Susanne Link & Ludger Woessmann, 2011. "Does School Autonomy Make Sense Everywhere? Panel Estimates from PISA," CESifo Working Paper Series 3648, CESifo Group Munich.
  3. Ana Rute Cardoso & Paulo Guimarães & Klaus F. Zimmermann, 2010. "Trends in Economic Research: An International Perspective," Working Papers 463, Barcelona Graduate School of Economics.
  4. Gianni De Fraja & Paola Valbonesi, 2009. "The Design of the University System," Discussion Papers in Economics 09/19, Department of Economics, University of Leicester.
  5. Carillo, Maria Rosaria & Papagni, Erasmo & Sapio, Alessandro, 2013. "Do collaborations enhance the high-quality output of scientific institutions? Evidence from the Italian Research Assessment Exercise," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 47(C), pages 25-36.
  6. Eric A. Hanushek & Ludger Woessmann, 2010. "How much do Educational Outcomes Matter in OECD Countries?," CESifo Working Paper Series 3238, CESifo Group Munich.
  7. Lisa Grazzini & Annalisa Luporini & Alessandro Petretto, 2011. "Competition between State Universities," CESifo Working Paper Series 3373, CESifo Group Munich.
  8. World Bank, 2012. "Universities Through the Looking Glass : Benchmarking University Governance to Enable Higher Education Modernization in MENA," World Bank Other Operational Studies 12535, The World Bank.
  9. Shahid Yusuf & Kaoru Nabeshima, 2012. "Some Small Countries Do It Better : Rapid Growth and Its Causes in Singapore, Finland, and Ireland," World Bank Publications, The World Bank, number 2243, August.

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