Abstract
Nowadays, the most typical reforms in higher education are conducted through the reorganization of universities either in the form of a merger, acquisition, or new status attainment. As a result, universities which educate local leaders for their respective national economies and have a profound impact on the regional economic development, as well as the composition of the labor market and intellectual potential, often encounter negative economic outcomes. The reforms that are imposed by the policymakers “from above” often hamper the development of universities and prevent them from fulfilling their roles described above. The process of reforming higher education in Russia is in many ways similar to the changes in the higher education systems of other European countries, in particular in post-Communist transition economies. Firstly, this process went through the integration into the global market of educational services. Secondly, it proceeded with the rethinking of the role of the university as a self-sustainable business organization. Thirdly, it was concluded by an increase in the demand and accessibility of education using the advancements offered by the digital technologies. Our paper argues that focused and well-balanced economic institutional design might be required for the sustainable development of reorganized leading universities. The project perspective implies that it is necessary to develop an institutional design in relation to what the organization seeks to achieve (either as its regulator or reformer) and how it intends to achieve these goals. In connection with the foregoing, we propose the following principles of designing effective institutions for the sustainable development of reorganized universities: (i) preservation of education as a “mixed” good (i.e., one that has the features of both public and private goods); (ii) transparency of decision making; (iii) complementarity of institutional change; and last but not least (iv) reduction in transaction costs.
Highlights
In the 21st century, higher education and the research and development (R&D) sector worldwide are undergoing profound changes (Möller 2018; Zapp and Ramirez 2019)
Speaking about “neoliberalism”, we were advised to be more precise about this terms which clearly deserves a good definition here, since any economic analysis appears to be meaningless without a definition and critique of the economic structures of neoliberalism in the political, cultural, economic, and governance context of the higher education, including the funding of higher educational institutions (HEIs) and the origins of the funding sources in the Russian Federation
There has been a shift from centrally planned bureaucracy to a market economy which came as a shock in 2008 and led to many structural issues as well as impacting on many sectors of economic and public life, causing many problems for HEIs in the Russian Federation
Summary
In the 21st century, higher education and the research and development (R&D) sector worldwide are undergoing profound changes (Möller 2018; Zapp and Ramirez 2019). Some of the major features of this transformation include the changes in the demographic characteristics of students, rapidly altering needs of actors, scientific and technological progress and the digital economy, labor market demands, as well as a plethora of other factors (Coates et al 2016; Payne et al 2017; Ren et al 2017; Boyce et al 2019) All of these factors have led universities and higher educational institutions (HEIs). The paper is structured as follows: Section 2 discusses the theoretical framework and the methodology, Section 3 contemplates on the issue of transaction costs of actors of reorganized universities, and Section 4 discusses how the effective institutions for reorganized universities can be derived It focuses on the principle of preservation of education as a “mixed” good, the principle of complementarity of institutional change, as well as on the principle of transparency in decision making and the diversity of incentives.
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