Sunday, March 7, 2010

Economics 07/03/2010: Consensus governance and failures to compete

Yesterday I tweeted about the case of attempted suppression of academic freedom in France (see here). An interesting paper, published in February 2010 by the Department of Economics, Tilburg University, titled Academic Faculty Governance and Recruitment Decisions sheds some light on the potential impact of the practices of suppressing dissent within our Universities.

In this paper, the authors analyzed the implications of the governance structure in academic faculties for their recruitment decisions. It turns out that “the value to individual members through social interaction within the faculty depends on the average status of their fellow members.” Which, of course, can be interpreted in common English as ‘cronyism’ or ‘collusion’. “In recruitment decisions, existing [faculty] members trade off the effect of entry on average status of the faculty against alternative uses of the recruitment budget if no entry takes place [i.e. getting their own hands on the pot of cash].” The study shows that “the best candidates join the best faculties but that they receive lower wages than some lower-ranking candidates”. The main policy implication raised by the study authors is that “consensus-based faculties, such as many in Europe, could improve the well-being of their members if they liberalized their internal decision making processes.”


Now, I’ve said on many occasions that our consensus-driven model of academic staffing would have never allowed people like Friedrich Hayek, or for that matter Milton Friedman, to be given tenure in Ireland. This is true, because hiring decisions in Irish universities – and I am speaking here from evidence relayed to me over the years in a number of actual cases – are based on social cliques (often organized around political and internal agendas, with loose affiliation with certain political ideologies). Anyone falling outside consensus, or threatening to ‘rock intellectual boat’ of dogmatic thinking and vested interests would never be allowed anywhere near a permanent post.


Of course this does not mean that everyone hired through the consensus process is not up to their jobs. Certainly such an assertion would be wrong. But it does mean that Irish academia is missing on critical thinking - a key ingredient in knowledge creation.

Ditto for our public sector. One example comes to mind.


Last year, the Central Bank was hiring a very senior research director. Amongst the applicants, there was a certain senior employee of the US Fed who holds, in addition to his Fed role, several senior academic positions worldwide in the area of Central Banking-related research. This person already held an exactly comparable position in the Fed for over a decade. He also has a list of central banking-related publications that would exceed those of any other academic in Ireland. This person was not even short-listed for the CB position, which subsequently went through an internal promotion to someone who has no publications on the subject, never had academic or practical experience in the area at the same level, but is a life-timer of the Irish public sector.


Consensus-based hiring at work, folks…

4 comments:

Kevin Denny said...

Consensus based hiring is in the nature of any organisation because it is human nature and academics are, after all, human. So I don't think Irish universities are unusual in that regard.

The story about the Central Bank is scary: one can only hope that this would not happen now.

Anonymous said...

Of course if they were hired at an Irish university Hayek, Friedman or Leon Trotsky would have got tenure because there is not such thing as a tenure policy worthy of the name in any Irish university. Yes, there is terrible consensus hiring at Irish universities based on cliques, but it is no worse than than the ideological hiring elsewhere (including parts of Irish academia) based on narrow conceptions of what counts as disciplinarity -the sort of stupidity that left the US without enough Arabists etc, or parts of Irish academia without any decent political economists.

EWI said...

or for that matter Milton Friedman

Can't say that I'd cry at such trials and tribulations of poor, oppressed, South-American-military-dictatorship-loving ideologues - or their groupies.

Seems to me that their abhorrence by decent people is the least that these delicate wallflowers deserve.

laughingbear said...

Constantin,

This example is so important! It not an exception, but the rule in this country since many years, hence leaving knowledge creation far behind in favor of life-timers.

It is a phenomenon that I witnessed in business as well. Years ago, I was suggested by a headhunter to talk to Oracle concerning a managerial position with p&l responsibilities. Three times I was on the plane to Munich, four more meetings in Ireland, yes, ridiculous, and at the end the job went to a much less experienced colleague with no international experience at all and very limited exposure to advanced business operations, but, he was a life timer! The procedure of wasting peoples time while internal promotions are already decided, is a common problem, because they are required to advertise Jobs externally as well.

Thanks for your continuing analysis, much appreciated!

Best
Georg

Last year, the Central Bank was hiring a very senior research director. Amongst the applicants, there was a certain senior employee of the US Fed who holds, in addition to his Fed role, several senior academic positions worldwide in the area of Central Banking-related research. This person already held an exactly comparable position in the Fed for over a decade. He also has a list of central banking-related publications that would exceed those of any other academic in Ireland. This person was not even short-listed for the CB position, which subsequently went through an internal promotion to someone who has no publications on the subject, never had academic or practical experience in the area at the same level, but is a life-timer of the Irish public sector.