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One of the most compelling reasons Universities offer tenure is that it provides them with a huge amount of cheap and disposable labor. Graduate students and associate professors work for next to nothing in hopes of achieving tenure, which is the economic engine that makes the University business model work. If the school has to pay all of those people a proper wage, the business model would be disrupted.
As a result, it makes sense for a University to offer tenure to a relatively small portion of their staff in order to ensure it can staff the rest. It's not unlike huge bonuses offered to top performers, which motivates everyone and not just the ones that receive it.
> I must admit that this description of academic freedom sounds pretty powerful and awesome. But are professors the only people in the “truth” business? Almost certainly not. (The postmodernist professors even deny that there is such a thing as objective truth, but let’s ignore that.) There are certainly other professions that have some claim on the pursuit of truth. Detectives try to figure out who committed a particular crime. Investigative reporters certainly see themselves as in pursuit of truth. But I have yet to see a tenure announcement for an investigative reporter on the local news.
Detectives and investigative reporters don't have tenure because their methods are often much more straightforward, easier to evaluate, and less controversial than academic discussion.
And while universities are designed to encourage diversity of thought, diversity of thought within a police department could be dangerous. Most newspapers are also supposed to be somewhat ideologically homogenous.
> If Alchian’s theory is correct, then one would expect it to be more likely that people get tenure in not-for-profit institutions than for-profit firms. Also, one would expect it to be more likely that tenure is awarded in publicly-funded institutions than in privately-funded institutions.
That's also consistent with the academic freedom hypothesis, if you believe not-for-profit and/or publicly-funded universities care more about academic freedom.
And that isn't counting the fact that private, for-profit institutiions might emphasize different things that may affect this analysis.
For example, although he controls for the presence of graduate degrees, he doesn't control for the extent to which universities emphasize graduate education, which could affect this analysis.
A very interesting take. I'm still mulling it through, but I did think about this issue (slightly) differently (given I'm not sure what property right mean in this context). Corporations (and for profit universities are that in the end) need to be flexible in responding to financial circumstances. So tenure is impossible for them to offer and why at-will termination is prevalent. The metric most for profit schools will be judged is outcome for students - which does not necessarily imply much higher education quality. We know that universities are important for networking and signal effects - so this leads to jobs. Thus a professor that can get people jobs is valuable - not necessarily the one that teaches how to determine OLS bias.
Regarding research (at non-profits) one issue is how do you measure quality. It's definitely not based on teaching quality in most places since it barely features in tenure decisions. Thus, it is research output. However, research output matters in so far as it brings paying students and donations. So one way would be for professors to specialize in bringing in donations (not only grants, but for example getting Ken Griffin to put money in the school). This all has been outsourced to administrators, in part because academics don't want to do that. So the main value from academics is then research. Now that's a risky proposition to have your career rely on. If you don't publish, you're fired basically. Tenure is that protection mechanism from the employee side. Since an employee's direct value cannot be measured in any meaningful way (beyond publications), and especially in the short run (some research becomes valuable in the future), I need to guarantee myself a job. Furthermore, regarding measuring via publications, we also know there is a university fixed effect - whether simply brand increases publications or how many resources it has (physical laboratories). So just publishing might also not be fully indicative of researcher quality.
Pushing for tenure also generates distortions - since you must publish in a short span of time, your research will more likely be 'safer' or at least that's what we were encouraged to focus on. So this significantly limits the topics covered and restricts certain difficult questions that for example are lacking data but need answers. Moreover, usually best research is done at a younger age - which especially true for parents for example.
Overall, I might be agreeing with the property right idea if by that you're implying that tenure is simply part of the total compensation package.
And apologies if my comment sounds a bit disjointed - still mulling through all the implications.
"At the Antitrust and Beyond Conference at the @StiglerCenter, @martincschmalz says that he was offered tenure if he retracted his research on monopoly industry leaned on the university administration (he declines to name the university)."
One of the most compelling reasons Universities offer tenure is that it provides them with a huge amount of cheap and disposable labor. Graduate students and associate professors work for next to nothing in hopes of achieving tenure, which is the economic engine that makes the University business model work. If the school has to pay all of those people a proper wage, the business model would be disrupted.
As a result, it makes sense for a University to offer tenure to a relatively small portion of their staff in order to ensure it can staff the rest. It's not unlike huge bonuses offered to top performers, which motivates everyone and not just the ones that receive it.
> I must admit that this description of academic freedom sounds pretty powerful and awesome. But are professors the only people in the “truth” business? Almost certainly not. (The postmodernist professors even deny that there is such a thing as objective truth, but let’s ignore that.) There are certainly other professions that have some claim on the pursuit of truth. Detectives try to figure out who committed a particular crime. Investigative reporters certainly see themselves as in pursuit of truth. But I have yet to see a tenure announcement for an investigative reporter on the local news.
Detectives and investigative reporters don't have tenure because their methods are often much more straightforward, easier to evaluate, and less controversial than academic discussion.
And while universities are designed to encourage diversity of thought, diversity of thought within a police department could be dangerous. Most newspapers are also supposed to be somewhat ideologically homogenous.
That idea also contradicts the history of tenure, assuming this study is correct: https://doi.org/10.2307/4609390
> If Alchian’s theory is correct, then one would expect it to be more likely that people get tenure in not-for-profit institutions than for-profit firms. Also, one would expect it to be more likely that tenure is awarded in publicly-funded institutions than in privately-funded institutions.
That's also consistent with the academic freedom hypothesis, if you believe not-for-profit and/or publicly-funded universities care more about academic freedom.
And that isn't counting the fact that private, for-profit institutiions might emphasize different things that may affect this analysis.
For example, although he controls for the presence of graduate degrees, he doesn't control for the extent to which universities emphasize graduate education, which could affect this analysis.
The concept of tenure always struck me as bizarre, as you write, its relatively unique and professors are not alone in the "truth" business.
My understanding is that tenure is also slowly disappearing.
A very interesting take. I'm still mulling it through, but I did think about this issue (slightly) differently (given I'm not sure what property right mean in this context). Corporations (and for profit universities are that in the end) need to be flexible in responding to financial circumstances. So tenure is impossible for them to offer and why at-will termination is prevalent. The metric most for profit schools will be judged is outcome for students - which does not necessarily imply much higher education quality. We know that universities are important for networking and signal effects - so this leads to jobs. Thus a professor that can get people jobs is valuable - not necessarily the one that teaches how to determine OLS bias.
Regarding research (at non-profits) one issue is how do you measure quality. It's definitely not based on teaching quality in most places since it barely features in tenure decisions. Thus, it is research output. However, research output matters in so far as it brings paying students and donations. So one way would be for professors to specialize in bringing in donations (not only grants, but for example getting Ken Griffin to put money in the school). This all has been outsourced to administrators, in part because academics don't want to do that. So the main value from academics is then research. Now that's a risky proposition to have your career rely on. If you don't publish, you're fired basically. Tenure is that protection mechanism from the employee side. Since an employee's direct value cannot be measured in any meaningful way (beyond publications), and especially in the short run (some research becomes valuable in the future), I need to guarantee myself a job. Furthermore, regarding measuring via publications, we also know there is a university fixed effect - whether simply brand increases publications or how many resources it has (physical laboratories). So just publishing might also not be fully indicative of researcher quality.
Pushing for tenure also generates distortions - since you must publish in a short span of time, your research will more likely be 'safer' or at least that's what we were encouraged to focus on. So this significantly limits the topics covered and restricts certain difficult questions that for example are lacking data but need answers. Moreover, usually best research is done at a younger age - which especially true for parents for example.
Overall, I might be agreeing with the property right idea if by that you're implying that tenure is simply part of the total compensation package.
And apologies if my comment sounds a bit disjointed - still mulling through all the implications.
You might find this interesting given the piece -
"At the Antitrust and Beyond Conference at the @StiglerCenter, @martincschmalz says that he was offered tenure if he retracted his research on monopoly industry leaned on the university administration (he declines to name the university)."
https://twitter.com/doctorow/status/1649071643938148352