Incentive-Based Budgeting Systems in Public Universities

Financial incentives play an important role in the behaviour of public institutions of higher education. This title examines alternative uses of these financial incentives, and reviews the consequences of their implementation. The book explores areas including: faculty behaviour in an incentive-based environment; effects on teaching; evaluation of decentralized approaches to budgeting; efficiency implications at the state level; and the ramifications of revenue flux on institutional behaviour. Case studies from the University of Toronto, the University of Michigan and Indiana University are also presented, and the volume concludes with recommendations regarding possible implementation strategies.

Table of Contents:
Contents: 1. Why Incentive-Based Budgeting Systems in the Public Sector and Why Now? Part I: Overview 2. The Case, if Any, for Responsibility Center Budgeting 3. The Efficiency of Responsibility Center Management within State Universities 4. Revenue Flux and University Behavior Part II: Case Studies 5. Responsibility Center Budgeting and Management at Indiana University 6. Responsibility Center Budgeting at the University of Toronto 7. Activity-Based Budgeting at the University of Michigan Part III: Effects and Lessons 8. Budget Incentive Structures and the Improvement of College Teaching 9. Reward Structures and Faculty Behavior Under Responsibility Center Management 10. Using Performance Indicators to Evaluate Decentralized Budgeting Systems and Institutional Performance 11. Incentive-Based Budgeting: An Evolving Approach Index

About the Author :
Edited by Douglas M. Priest, Associate Vice Chancellor for Budgetary Administration and Planning, and Associate Professor of Educational Leadership and Policy Studies, Indiana University, US, William E. Becker, Professor of Economics, Indiana University, Bloomington, US, Adjunct Professor, School of Commerce, University of South Australia and Editor, Journal of Economic Education and Editor, Economic Research Network Educator, Don Hossler, Vice Chancellor for Enrollment Services and Professor of Educational Leadership and Policy Studies and Edward P. St. John, formerly Professor of Education, Leadership and Policy Studies, Indiana University and Director, Indiana Education Policy Center and Consulting Editor for Research in Higher Education, US

Review :
'The collection of papers in Incentive-Based Budgeting Systems in Public Universities is sure to warm the hearts of university presidents, budget directors, department chairs, faculty, and others who have long suspected that budgeting and education, research and service must somehow be related. It will also serve as a reference for those who have their doubts. . . The benefit of a volume such as Incentive-Based Budgeting Systems in Public Universities is that it provides the reader with the background and basis for thinking about alternatives to the status quo as applied to higher education finance. When the issues are as complex as budgeting in higher education, and when much of the potential audience is likely to be dubious that change might be effective, the discussion must be comprehensive enough to encourage further investigation while keeping an open mind. Incentive-Based Budgeting Systems in Public Universities meets these criteria.' 'This book provides an excellent set of stories on the trials, tribulations and successes of this inevitable university adjustment.' 'Incentive-based budgeting in higher education comes in many guises: and this edited collection, Incentive-Based Budgeting Systems in Public Universities, does a good job in reviewing the theory, describing case studies, and offering analysis of this multifaceted practice. The book is well written, sufficiently rigorous, and insightful of how such budgeting systems work in higher education; it describes a sensible alternative to the more common practices of formula funding, activity-based costing, and incremental budgeting. . . Incentive-Based Budgeting Systems in Public Universities serves as an up-to-date, interesting, and useful treatment of funding systems within US universities. The case studies in particular are useful evidence that, even for complex enterprises such as colleges, incentives can be made to count.' 'As public universities are facing severe financial pressures due to rising costs and declining revenues, innovations in budgeting formats provide the best hope of coping with the problem. The advantages and limitations of public universities adopting the incentive-based budgeting approach that has been used in private universities are expertly and articulately examined in this book. It is a 'must read' for all university administrators, members of governing boards, legislators, and policy analysts who are seriously searching for innovative ways to increase universities' efficiency in their use of increasingly scarce resources.'