RichardsonClaiborne
The managerial structure of a typical university has evolved very significantly since the past few decades. Todays’ universities borrow more and more practices from their counterparts in the corporate world. In the current study, we argue that the managerial structure shift occurred in the higher education institutions intensifies the separation of ownership and control which translates into many forms of agency costs. Indeed, our empirical evidence suggests that from 1987, the employment of administrators and professional staff substantially outpaces those of full time faculty which in part contributes to the escalating tuition and fees. The year of 2011 marked the first year in the history of higher education that part-time faculty outnumbered fulltimers. We speculate that this is an effort of trying to mitigate rising tuition. Yet, the tuition and fees a typical student paid for higher education service still doubled since 1987 measured by 2011-2012 constant dollars.