Wednesday, April 18, 2007

The Bob Vedsky Proposal for Contingent Faculty

By Richard Vedder

In my book Going Broke By Degree and elsewhere, I advocated that more services, including instruction, be provided to universities by private providers under short or intermediate term contracts. My friend Bob Zemsky of Penn (The Learning Alliance) has carried this idea one step further: why don't so-called "contingent faculty" do better than unionize --why don't they incorporate --and then sell their services collectively to universities? Universities can have a competitive bidding process with different instructional companies, perhaps owned and operated by contingent faculty themselves. They hire the firm, and thus do not have to worry about fringe benefits, legal issues relating to having employees on their payroll, etc. The owner-employees no longer have university bosses and control their own destiny. They save union dues, and are not mixed in the same union with others (full time tenured faculty) who may have competing economic interests.

The little corporations could be very small, say two or three friends selling their services to the Modern Language Department to teach beginning French or Spanish, or could be huge, selling services university-wide. In the long run, larger companies will try to buy up the smaller firms and try to achieve some economies of scales. How that would work out is unknown, because I am uncertain as to the scale economies realizable here, but I suspect they are sizable (e.g., developing a common curriculum usable on many campuses, offering common multi-campus exams, perhaps have some lectures provided at multiple campuses simultaneously using distance learning techniques).

At first, I thought Bob and I were the odd couple on the Spellings Commission, me the resident radical and Bob the ultimate Establishment cautionary voice (many of Bob's remarks started, "You got to be careful...." ) But I realized in the long run that we actually have in many ways very similar ways at looking at things, with a mutual appreciation of using market forces to break down inefficient bureaucratic ways of doing things.

To schools facing an unionization threat from contingent faculty: tell them, "incorporate yourselves and liberate yourselves from both us and the unions."


Ken D. said...

"The little corporations could be very small, say two or three friends selling their services to the Modern Language Department to teach beginning French or Spanish, or could be huge, selling services university-wide."

Alternatively, why shouldn't highly-qualified scholars be permitted to sell their services directly to the ultimate customer?

In other words, why can't qualified scholars "hang out a shingle" and sell their professional services directly to the end-users just as legal and health care professionals often do? This is a system which formerly worked well in for example ancient Rome or Victorian England, where much of the best education was provided by private tutors.

Moreover, with our rapidly rising college prices, the basic economics of this form of "vertical integration" would seem favorable. For example, consider this quote from Bruce Haywood's recently published book "The Essential College".

Dr. Haywood writes "Nobody is quite willing to use the word “customer” out loud, but in their eagerness to satisfy student expectations colleges seem to have adopted a “customer is always right” approach to both prospective and enrolled students. That all of this translates into ever higher bills for parents is obvious. In my first year at Kenyon my salary, without fringe benefits, was roughly equal to the sum of comprehensive tuition and fees paid by four students.. If a beginner at Kenyon today were paid by that same formula, his salary would be around $150,000. That his salary is instead around $38,000 means that a lot of student money is going to things other than faculty salaries. It will likely be going to pay for a resident physician or at least a clinic with a full—time nurse, resident psychological counselors, a relentlessly expanding computer center, more extensive academic services like a larger library, to say nothing of those associate and assistant deans. A college today is a far more complex enterprise, and far more expensive to run, than was the college of fifty years ago It is that in part because students and parents expect it to be, want it to be. And, yes, there’s a lot of money going into coddling. But the worst kind of student coddling today is not detectable as a line item in the budget.".

David said...

Many universities are like a strange combination of Wal-Mart and Nieman Marcus. Like Wal-Mart, they work hard at driving down the cost (to them) of the product they sell: Wal-Mart demands absolute rock-bottom pricing from their suppliers, and universities do the same to the junior faculty who actually teach a large proportion of the courses. But whereas WMT uses its low cost position to enable low prices to the ultimate consumer, many universities seem to prefer Nieman Marcus pricing to *their* end customers.