University merging process: A guideline proposal for excellence-enhancing

Abstract

There is a recent trend toward encouraging universities to merge. This policy is based on the idea that mergers create synergy gains that enhance the prestige of universities by increasing their international visibility. However, this process may reduce competition for both research funds and professors in national higher education markets. This paper analyzes whether mergers among universities are optimal from an excellence perspective. We find that as the heterogeneity between the initial reputations of potentially merging institutions increases, the amount of funds required for mergers to achieve higher excellence than competition also increases.