Abolishing tenure and academic competitive strategy

The U.S. state of Texas is trying to abolish tenure for public university professors. If this comes to pass, it would be a highly interesting natural field experiment on academic competitive strategy. From an academic perspective, I’m quite curious about this.

Tenure means job security: Tenured professors can’t (easily) be fired, ensuring freedom of research and teaching. As a consequence, salaries are relatively lower to equally skilled people (in industry) without such job security. Also, it stands to assume, people who accept this trade-off are more risk averse than those who avoid it. Finally, choosing the path of a tenured professors creates lock-in into this path and it is not easy to leave, increasing both buy-in and staying power under adverse circumstances as well as more disgruntled and disengaged professors.

If tenure was to be abolished, I’d expect to see the following consequences:

• Salaries need to get competitive with industry, or even higher given the remaining disadvantage of lock-in into the professorial career
• Universities will become more like corporations. Given that a professor could get fired fairly easily, there will be less academic freedom to dissent with their employer
• Professors in disciplines of industry relevance will try to stay close to industry to maintain employability outside of academia

I don’t know, but I speculate this will also lead to the following:

• Academic disciplines with little or no industry relevance (e.g. most of the humanities) will be diminished and wither, leaving more for STEM disciplines
• The changed conditions will attract professors who work closely with industry and consequently research and teaching will also be close to industry

Depending on further conditions,

• Research will either get more linear and applied and hence less groundbreaking (because professors want to stay close to industry) or
• It might get more entrepreneurial (because startups are a way of accumulating independent wealth and maintaining industry relevance as well)

The cynic in me assumes that the potential abolishment of tenure is a ploy to curtail freedom of academic speech. But it could also have the goal of more entrepreneurship and/or industry relevance in research and teaching. It certainly is in line with the common U.S. (or just Texan?) assumption that you need to put pressure on people for them to excel.

On a positive note, if this came to pass, it would be a significant natural experiment, economists would be all over it, and the (academic) world would be watching.