FACULTY MOTIVATION AND THE ROLE OF SOCIAL CAPITAL IN HIGHER EDUCATION

The objective of this paper is to investigate the incentive structure of higher education and the role of social capital in it. In the beginning are proven the limited capabilities of the market mechanisms to stimulate the creation of high quality educational outcomes. After that are revealed the benefits from reciprocal relations in higher education institutions and development of a system of altruistic moral norms, which turn universities into communities centered on the cooperation, tolerance and solidarity values. Next the paper considers the role of social capital for increasing educational revenues and decreasing the transaction costs and personnel expenditures. Finally the question of social capital accumulation sources is analyzed. The latter are sought in the choice of the social enterprise as an organizational form and adopting those management structures that stimulate freedom and equality among the members of higher education institutions.