Knowledge in the Development of Economies
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Knowledge in the Development of Economies

Institutional Choices Under Globalisation

Edited by Silvia Sacchetti and Roger Sugden

This innovative book offers a critical perspective on the state of the current global economy, making sense of knowledge-related issues by critically assessing existing institutional choices, as well as pointing to new ways forward.
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Chapter 6: Destroying Creativity? Universities and the New Public Management

Sonja Grönblom and Johan Willner


Sonja Grönblom and Johan Willner INTRODUCTION 1. In this contribution we analyse the university as an economic organisation, mainly because university reforms are advocated with economic arguments and not because of any alleged superiority of economics in understanding the nature of research and higher education. Budget cuts, managerialism, performance management with a focus on output, and often economic sticks and carrots at all levels seem to be the order of the day almost everywhere. We shall therefore ask whether such reforms really make economic sense, and make a case for an autonomous university characterised by collegiality and academic freedom. This chapter is organised as follows. The next section briefly describes the so-called new public management and its consequences for universities. Section 3 warns against false analogies and describes the traditional university. Section 4 focuses on incentives, because of the underlying belief that university employees would not work properly without sticks and carrots. We make the point that the role of incentives cannot be to make academics work harder, because most of them are highly motivated. The following section (5) puts the incentives into context as a mechanism for motivation-crowding out. This is a prerequisite for a strong leadership that redirects the university so as to focus on product and process innovations for the business community. Section 6 includes some complementary comments and section 7, concluding remarks. 2. THE NEW PUBLIC MANAGEMENT Those who advocate university reforms often refer to inefficiency (see, for example, Jacobs and van Ploeg, 2006). Universities...

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