How Does the Governance of Academic Faculties Affect Competition Among Them?
AbstractWe analyze competition among academic faculties for new researchers. The value to individual members through social interaction within the faculty depends on the average status of their fellow members. When competing for new members, existing members trade off the effect of entry on average status of the faculty against the reduction in teaching load that can be bought if no entry takes place and the entrant's wage is saved. We show that the best candidates join the best faculties but that they receive lower wages than some lower-ranking candidates. Endogenizing the governance structure of the faculties, we show that the aggregate surplus of a faculty is maximized if a decision-making rule is implemented that makes the average faculty member pivotal. Our main policy implication is that consensus-based faculties, such as many in Europe, could improve the well-being of their members if they liberalized their internal decision making processes.
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Bibliographic InfoPaper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2009-49.
Date of creation: 2009
Date of revision:
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Web page: http://center.uvt.nl
Academic faculties; university governance; organizational design; status organizations;
Find related papers by JEL classification:
- D02 - Microeconomics - - General - - - Institutions: Design, Formation, and Operations
- D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-03 (All new papers)
- NEP-LAB-2009-07-03 (Labour Economics)
- NEP-SOG-2009-07-03 (Sociology of Economics)
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