Academic Tenure and the Rising Cost of Higher Education: An Economist’s Point of View

Abstract

The tenure system is one of the most debated topics lately in the sector of higher education. It is perceived that strong tenure protections impose significant costs on higher education which in turn leads to skyrocketing fees and tuition. In this article, we argue that academic tenure promotes research especially in those fields with low near-term market return. It also helps to protect grading integrity and maintain the quality of higher education. Our argument suggests that the tenure system helps to lock in costs for universities in the sense that it is akin to purchasing labor under a long-term contract at a low price. Hence, eliminating academic tenure in the hope of reducing skyrocketing college fees and tuition is an unrealistic proposal.