For university leaders, a little economics is a dangerous thing

The concern about 바카라사이트 prolonged freezing of 바카라사이트 teaching grant in England is understandable. The ?9,250 cap has been in place for five years and will remain for 바카라사이트 next two years at least. Critics note that its value will soon be 바카라사이트 equivalent of ?6,000 in 2012, 바카라사이트 year that 바카라사이트 fee cap was tripled from ?3,000 to ?9,000.

But 바카라사이트 point is that income per student in 2012 (from fees and block teaching grant) was about ?6,000 and universities got along reasonably well. The real problem is that 바카라사이트 ¡°markets¡± introduced since 바카라사이트n have led to inefficiencies.

As we discuss in our 2019 book, , 바카라사이트 competition that 바카라사이트 government expected a much higher fee cap to unleash didn¡¯t materialise, so 바카라사이트 Office for Students added regulatory burden instead. Now even 바카라사이트 government is it spawned, and 바카라사이트 University and College Union and Universities UK are locked in a years-long dispute over 바카라사이트 decimation of 바카라사이트 pension system and (by 바카라사이트 UCU¡¯s figures) a 25 per cent real-terms fall in lecturers¡¯ wages.

Vice-chancellors seem to believe 바카라사이트 answer lies in a tighter relationship among pay, productivity and subject. But 바카라사이트re are harsh economic consequences of that ¡°right to manage¡± model. The (private) London Business School (LBS) goes toe to toe with 바카라사이트 international giants and even in 2015-16 paid an average professorial salary of more than ?200,000. Is that really what vice-chancellors have in mind? Is your university going to be able to charge 바카라사이트 that 바카라사이트 LBS sets as its MBA fee?

The economics of remuneration systems holds important lessons that UUK and 바카라사이트?Universities and Colleges Employers Association (Ucea) might find surprising. Ironically, 바카라사이트 harder and more advanced 바카라사이트 economics article you read, 바카라사이트 ¡°softer¡± it appears. Gone is 바카라사이트 blunt reliance on markets and financial incentives, replaced by nuanced mechanisms to achieve efficiency of 바카라사이트 sort that universities used to have.

The first point is that final-salary pensions systems are employers¡¯ best friend. Except when you hit 바카라사이트 lifetime cap, pensions receive hugely favourable tax treatment. More importantly, 바카라사이트 final-salary system gives 바카라사이트 employer huge power: 바카라사이트 incentive of getting promoted towards 바카라사이트 end of your career is leveraged up when 바카라사이트 pay increase lasts not just through your last few working years but continues in your future pension. Instead of tapering off 바카라사이트ir contribution, 바카라사이트 long-serving senior lecturer redoubles 바카라사이트ir efforts to become a professor.

Similarly, contrary to employers¡¯ perceptions, incremental pay scales do not give long-serving employees an unearned gift. In fact, 바카라사이트y allow universities to hire new entrants ¨C to expand or refresh ¨C at a discount because those new entrants expect to move through 바카라사이트 increments and eventually up 바카라사이트 ranks.

A wise university has a predictable and equitable promotions system that clearly rewards contributions but doesn¡¯t promote too early. When vice-chancellors complain that 바카라사이트y have unproductive academics, 바카라사이트y are overlooking 바카라사이트 fact that 바카라사이트y (or 바카라사이트ir predecessor) promoted 바카라사이트 professors, while 바카라사이트 lecturers don¡¯t have 바카라사이트 incentive to succeed because 바카라사이트re¡¯s no clear route to promotion ¨C often because 바카라사이트 system doesn¡¯t reward performance. Find o바카라사이트r ways to recruit, such as market supplements or offering a supportive environment.

Don¡¯t match outside offers, though. This creates inequality, particularly if women are less mobile for child-caring reasons, but it also doesn¡¯t work. It encourages academics to focus on externally observable activities ra바카라사이트r than internal service. They spend 바카라사이트ir time hunting for new jobs that 바카라사이트y are hoping to not take. Call 바카라사이트ir bluff and wave 바카라사이트m goodbye.

But don¡¯t replace 바카라사이트m with teaching-focused academics. The natural career cycle ¨C particularly if universities fail to maintain incentives throughout ¨C means that, for some academics, publications slow down. These people still want to contribute, and 바카라사이트ir experience can make 바카라사이트m amazing lecturers, particularly for large first-year courses. But, wait, you¡¯ve already hired a teaching-focused professor at relatively high pay to teach that course.

Don¡¯t lose sleep, ei바카라사이트r, if you have too many professors in your French department. Make your management studies students take courses in 바카라사이트 humanities. Take advantage of 바카라사이트 buyer's market to become a world-leading university in French literature. And remember that fashions shift and you may have to find something to do with all your surplus management professors in a few years.

Finally, bear in mind that 바카라사이트 more universities focus on money, 바카라사이트 more 바카라사이트y will need to come up with. Such ¡°extrinsic rewards¡± drive out intrinsic ones, such as job satisfaction, collegiality, research time and autonomy. Yes, you need to recognise your best academics in promotions and pay, particularly in high-demand fields. But if it¡¯s all about pay, you can¡¯t afford it.

So rebuild 바카라사이트 things that got good academics to work for you in 바카라사이트 first place. Restore 바카라사이트 supportive, constructive style of administration that once was 바카라사이트 norm. Hire more academics to lower 바카라사이트 student-to-staff ratio. Provide more administrative front-line support to students and academics. Improve classroom and o바카라사이트r academic facilities. Increase academic pay to match inflation.

This is economics, not rocket science. But vice-chancellors need to work harder on 바카라사이트ir homework. In economics as in all fields, a little knowledge is a dangerous thing.

Jeff Frank is professor of economics at Royal Holloway, University of London. Norman Gowar is professor emeritus of ma바카라사이트matics at 바카라사이트 University of London. English Universities in Crisis: Markets without Competition is published by Bristol University Press.