The government‐higher education institution relationship: Theoretical considerations from the perspective of agency theory

Abstract

This article introduces the agency theory to the field of higher education research. By applying agency theory to the inter‐organisational relationship between government and higher education institutions, it is possible to illustrate general problems facing control and governance in a more theoretical and analytical way. The conceptual arsenal provided by the agency theory may benefit various research settings that are related to government‐higher education institution relationships. In addition to its descriptive elements, agency theory also provides theoretical explanations for e.g. the establishment of quality assurance systems and performance‐based funding procedures.