Higher Ed’s Diseconomies of Scale
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Texas has six public university systems. Good, explains Charity-Joy Acchiardo
In Texas, we take pride in doing everything BIG. That seems to apply to our university systems, as well. While other states have one or two public university systems, we have six! “Why?” a colleague recently asked. “Wouldn’t Texas be better off merging some of its systems and saving on administrative costs?”
My inner economist immediately balked at this idea. More is generally better, correct? A number of past Nobel laureates came to mind. Certainly F. A. Hayek would agree that multiple systems foster innovation, as each strives to move ahead in the discovery process, experimenting with new models in a dynamic educational landscape. George Akerlof might argue that each system and its individual institutions build a distinct brand and reputation over time, which serves as a crucial signal of quality to students and employers. Elinor Ostrom could highlight the benefits of polycentric governance, which allows individual systems to tailor their programs and rules to the specific, unique needs and circumstances of their local area.
The question piqued my curiosity, so I did a little digging to see how administrative costs in Texas compare to those of North Carolina, where my colleague calls home. The American Council of Trustees and Alumni has built a wonderful tool to compare university administrative costs across the United States.
Economic Dynamism
The Price of Stagnation: Britain’s Retreat from Dynamism
We face a basic issue: we do not let cities or communities grow or die.
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London and the Architecture of Creative Growth
Preserving London's creative dynamism will require humility from policymakers and a commitment to keeping the city liveable.
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Is Economics a Failure?
Rather than ending with “economics is broken,” Alexander Rosenberg’s deliberately provocative book 'Blunt Instrument' argues that “economics is useful for a different reason than economists often say.” That is a serious and worthwhile thesis.
Locke, Meet Claude
The concern is not regulation per se. It is a regulation that outruns its justification by arriving before the evidence, foreclosing the technology before its benefits are understood, and insulating the powerful from competition that would otherwise discipline them. That is the pattern worth resisting.
