'Star scientists' not new buildings make universities successful

History shows us that brains are far more important than buildings for the quality of research output in the higher education sector - says Fabian Waldinger

At the moment - countries like Brazil, South Korea and especially China are investing heavily in their university systems. Should they hire outstanding scholars or construct new laboratories to achieve the highest return on their investment? Similarly, many other countries - including the United Kingdom, are scrutinising their expenditures for higher education. In which areas would spending cuts be less harmful?

Investigating these questions is challenging because 'star scientists' like to work in more productive universities but at the same time they enhance the productivity of their university. Similarly, high-quality universities attract more funding for laboratories and buildings - which further increases productivity. As a result, it is difficult to evaluate how much high quality scientists and better facilities contribute to the creation of scientific knowledge.

We can investigate these questions by analysing a historical episode that affected German and Austrian universities in the 1930s and 1940s. In 1933, just two months after the Nazi government seized power, Jewish scientists and other scientists with opposing political views were dismissed from the German - and later from Austrian - universities. Overall, about 15 per cent of scientists had to leave their positions. Among the dismissed were some of the best scientists of the time. Names like physics Nobel Laureates Albert Einstein, Max Born, Erwin Schrödinger and chemistry Nobel Prize winners Fritz Haber and Otto Meyerhof.

Universities that had employed many Jewish scientists, therefore, suffered a tremendous decline in the number and quality of their faculty. Some years later, Allied bombings during the Second World War destroyed the facilities of some universities while leaving the buildings of institutions in other cities completely intact. These temporary shocks affected German and Austrian universities both in the short and in the long run.

To control for other factors that may have changed over time, my research has compared universities with dismissals to universities without dismissals. Similarly, we can compare universities with bombing destruction during the Second World War to universities without destruction. The findings indicate that the dismissal of 10 per cent of the faculty reduced departmental productivity by about 0.21 standard deviations in the short run. Strikingly, departments that had lost people during the Nazi era still had lower scientific output almost 50 years later.

The destruction of 10 per cent of university buildings during the Allied bombing campaign lowered productivity by about 0.05 of a standard deviation in the short run; a reduction in productivity that was only about a quarter of the effect of the dismissal of 10 per cent of the faculty. Furthermore the negative effect did not persist. By 1961, the productivity of departments that had been bombed during World War II had already recovered.

Furthermore, results indicate that the drop in productivity was particularly large after the loss of 'star scientists'. This shows that, at least for this historical period, brains were far more important than buildings for the quality of research output. In recent decades scientific research has relied much more on expensive equipment, such as particle accelerators, and so it is not entirely clear how much these historical findings can inform current policy. Nonetheless, they suggest that spending money on attracting high-quality scientists may be money well spent if a university or country wanted to raise its research output.

Fabian Waldinger is assistant professor at Warwick University's economics department and author of Bombs, brains and science: the role of physical and human capital for the creation of scientific knowledge