Do merger policies increase universities’ efficiency?

Universities’ mergers are one policy instrument used to fashion higher education systems to meet current challenges, such as massification, international rankings and the more efficient use of scarce resources. Much of the existing literature suggests that mergers can have positive outcomes. This study is focused on the effect of merger policies in Russia on universities’ efficiency. We consider a round of non-voluntary mergers conducted by the Ministry of Education on the basis of universities’ performance indicators. In the first stage, efficiency scores of merging universities were estimated using a bootstrapped DEA non-parametric technique (for an appropriate control group formed through a propensity score matching approach) before and after the implementation of the merger policy. In the second stage a fuzzy regression discontinuity design was implemented in order to reveal the causal impact of mergers on the level of efficiency. We find that the merger policy had a statistically significant positive effect on universities’ efficiency. The merged universities also experienced greater efficiency gains after the merger was implemented.

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