Universities’ internal governance and their efficiency: empirical evidence from Russia

Abstract This paper aims to assess the relationship between governance practices and the efficiency of universities. We use the conditional efficiency approach and a partial frontier approach (order‐m estimator) for measuring universities’ efficiency and consider three important clusters of practices: centralisation, the growth of management teams at the administrative level and incentives for staff. The specific governance practices of universities are positively associated with their efficiency, the results differ for research‐oriented and teaching‐oriented universities. The optimal strategy for research‐intensive universities would be to provide a reasonable level of autonomy and optimal investment in administrative support (administrative staff salaries), while possible recommendations for teaching‐oriented universities include centralising some functions that reduce the administrative burden on the department.