Recruitment strategies in a university institution: a theoretical cost minimization approach

We study faculty recruitment issues in a university. We develop a cost minimization model that considers the decision-making process for the university administration by proposing a new approach of selecting tenure and non-tenure track faculty who are expected to achieve the institutional research and teaching goals. We explain the existence of tenure from an economic perspective. We propose a faculty tenure-granting process for a variety of institutions ranging from pure-teaching, teaching emphasis, research emphasis and pure-research institutions. We find that a teaching-emphasis or a pure-teaching institution (a research-emphasis or a pure-research institution) can increase the emphasis on research (teaching) without increasing costs. This paper makes important contributions to the university recruitment strategy by providing a set of guidelines on how to manage teaching and research incentives. The paper also contributes to the ongoing debate about tenure by providing a newer perspective and to the general theory of strategic university management.