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Abstract
Declining state revenue, increased expenditures and rising costs at public universities are critical issues that are further heightened by the current economic environment. In an effort to address the challenges associated with reduced revenue and rising costs, this theoretical paper will explore how public institutions can leverage the resource dependency theory framework for strategy formulation and increased resource capacity. The organization of the paper begins with an introduction that sets forth the topic parameters and rationale of the paper. This is followed by a literature review that provides an overview of pertinent fiscal issues and strategies that were designed to mitigate these issues in public higher education. The authors then introduce the resource dependency theory and its linkage to public higher education based upon an understanding of the institution’s interdependence with the external environment. Based upon the resource dependency theory, the authors discuss strategies that can garner greater resources and serve as a guide for university administrators and leaders during strategic planning efforts.
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