Archive for 20 December 2006

The Vertical Dis-Integration of Higher Education

| Peter Klein |

In 1975, 56.8 percent of the teaching faculty at US colleges and universities were tenured or on the tenure track, with 30.2 percent classified as part-time employees. By 2003, tenured and tenure-track faculty comprised only 35.1 percent of the teaching staff, with part-timers making up 46.3 of the total. These data are from the latest AAUP report on faculty employment, sounding an alarm over the rise of what it calls “contingent faculty.” (Thanks to Richard Vedder for the pointer.)

This trend may have important implications for academic freedom, faculty governance, political correctness, and the nature of higher education more generally. From an economic efficiency perspective, it looks like vertical dis-integration, a shift from long-term employment contracts to shorter-term, more flexible arrangements. If the higher-education sector is simply following the private sector’s lead, should we be surprised? And what factors would be driving the changes — a decrease in relationship-specific human capital, an increase in modular methods of production, changes in environmental uncertainty, etc.? (more…)

20 December 2006 at 12:28 pm 2 comments


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Nicolai J. Foss and Peter G. Klein, Organizing Entrepreneurial Judgment: A New Approach to the Firm (Cambridge University Press, 2012).
Peter G. Klein and Micheal E. Sykuta, eds., The Elgar Companion to Transaction Cost Economics (Edward Elgar, 2010).
Peter G. Klein, The Capitalist and the Entrepreneur: Essays on Organizations and Markets (Mises Institute, 2010).
Richard N. Langlois, The Dynamics of Industrial Capitalism: Schumpeter, Chandler, and the New Economy (Routledge, 2007).
Nicolai J. Foss, Strategy, Economic Organization, and the Knowledge Economy: The Coordination of Firms and Resources (Oxford University Press, 2005).
Raghu Garud, Arun Kumaraswamy, and Richard N. Langlois, eds., Managing in the Modular Age: Architectures, Networks and Organizations (Blackwell, 2003).
Nicolai J. Foss and Peter G. Klein, eds., Entrepreneurship and the Firm: Austrian Perspectives on Economic Organization (Elgar, 2002).
Nicolai J. Foss and Volker Mahnke, eds., Competence, Governance, and Entrepreneurship: Advances in Economic Strategy Research (Oxford, 2000).
Nicolai J. Foss and Paul L. Robertson, eds., Resources, Technology, and Strategy: Explorations in the Resource-based Perspective (Routledge, 2000).