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  • Economic stratification of higher education institutions in the period of budget reform, increasing autonomy (transition to an autonomous institution) and changes in final examination of high school graduates (transition to mandatory Unified State Examination)

Economic stratification of higher education institutions in the period of budget reform, increasing autonomy (transition to an autonomous institution) and changes in final examination of high school graduates (transition to mandatory Unified State Examination)

2009
Department: Centre for Financial and Economic Decisions in Education

The purpose of the research is to study the positioning of higher educational institutions in the market of educational services in an environment of budget reform, rising autonomy of institutions and changes in the final examination of high school graduates (transition to mandatory Unified State Examination).

This research studies issues of higher education institutions’ typologization depending on their economic potential and development strategy in various socio-economic environments. We have evaluated proposals to study the typology of higher education institutions depending on their ability to manage resources during the period of the reforms. We have analyzed management mechanisms used both for public funding and for extra-budgetary resources, development of material, technical basics and laboratory equipment, facilities and their ability to develop the asset complex as well as the contribution of institution’s prestige value. This kind of typology allows us to combine objective analysis of institution’s financial position and the quality of applicants, choosing a certain higher education institution. i.e. to combine objective characteristics with the subjective perceptions of applicants and their family members.

The uniqueness is determined by a combination of external conditions of an institution’s functioning, such as the transition to the system of financing by state order, taking into account not only the quantity, but also the quality of provided services, efficiency of an institution’s operations, with internal characteristics, reflecting the transition to principles of responsible financial management, increasing autonomy and independence as well as subjective characteristics, related to the choice of the higher education institution by applicants amid the transition to the mandatory Unified State Examination (USE).

Previous studies were conducted when the previous version of the Budget Code was in effect, i.e. with absolutely different financing mechanisms, experimental introduction of the Unified State Examination, disregarding the possibility of the change in the institutions’ status and transition to actual autonomy and independence in allocating of the funds. In the environment of budget reform, increasing autonomy of higher education institutions (autonomous institution status) and change in the final certification of high school graduates, stratification of higher education institutions has substantially altered, which determines the relevance of this study. Previously obtained results allow us to research institutions’ stratification over time as well as changes in applicants’ and their families’ preferences.

During the first stage of research, we focused on the following tasks to evaluate the results in terms of institutions’ typology depending on their economic conditions and forecast the transition of various types of institutions to a form of autonomy:

  • Collection of data on institution financing from budget and extra-budget sources;
  • Analysis of economic conditions of higher education facilities;
  • Building institutions’ typology depending on their economic standing;
  • Forecasting the transfer of institutions of various types to a form of autonomous institution.

In the second stage of research, we concentrated on economic stratification of higher education institutions amid budget reform, rising autonomy and the change in final certification of high school graduates (move to mandatory Unified State Examination), performing the following tasks:

  • Collection of data on the USE results for each discipline and distribution of the graduates in the institutions depending on USE results;
  • Analysis of the 2009 data and conducting a comparative study based on the 2003/2004 data;
  • Building economic stratification of higher education institutions in the environment of budget reform, rising autonomy and the change in final certification of high school graduates.

Key findings from the research:

The budget reform, transition to the autonomy and the change in final certification of high school graduates has considerably changed the economic conditions of higher education institutions as well as their development strategies. We noted intensified differentiation of institutions depending on their economic potential, effective demand from the public, quality of provided educational programs (appeal of the higher education institution and offered majors for applicants).

Strong higher education institutions that have a multi-disciplinary profile and a diversified strategy may attract better trained applicants, have all budget-funded places filled, find applicants for commercial places and due to their independence and efficient resource management be able to ensure competitiveness of the institution in the education service market.

Currently, the most successful institutions in terms of innovative development are those simultaneously developing three types of education activities:

  • Development of education technologies, facilitating integration of project and research tasks into academic activities;
  • Promoting projects related to the development of various technologies, sectors and industries;
  • Conducting both fundamental and applied research.

Efficient combination of these three processes in creating and renewing educational projects ensures their competitiveness.

We hypothesize that weaker institutions will lose  part of their applicants to  budget-funded places, will be unable to attract applicants to commercial places and their economic conditions will sharply deteriorate. A solution to this problem may be a strategy of integration with stronger institutions (we expect an upsurge of mergers and acquisitions). However, the process will go in fits and starts in terms of dynamics and geography. Institutions that used to have strong positions amid the growing economy, but lost their appeal among fee paying students  at the start of the crisis and those who use inefficient management technologies and have no close ties with employers who can provide jobs for their graduates may join the weaker group.