Vol. 9 (2025)
Emerging Trends in Education

Articles

THE MERGER OF TOP UNIVERSITY- EXPLORING THE OPERATIONAL EFFICIENCY OF TAIWAN’S NYCU FROM A FINANCIAL PERSPECTIVE: Received: 26th November 2025, Revised: 1st December 2025 & 03rd December 2025, Accepted: 05th December 2025, Date of Publication: 12th December 2025

Published 2025-12-12

  • Chiou Rung Chen

Chiou Rung Chen
Department of Educational Management, National Taipei University of Education, Taiwan

Abstract

This study utilized data envelopment analysis (DEA) to empirically evaluate the operational efficiency of Taiwan's top university NYCU from a self-financing perspective between 2012 and 2023. The results demonstrated that although the merged NYCU maintained increasing returns to scale (IRS) in research output, his teaching output transitioned to more severe decreasing returns to scale (DRS) beginning from the second year post-merger (2022). This shift, coupled with a simultaneous surge in four input factors—particularly administrative and general affairs
expenses—drove NYCU's overall operations into increasingly severe scale inefficiency. The findings confirmed that the merger-induced diversity of fields, disciplines, and missions, along with the multi-campus structure, resulted in diseconomies of scale and scope. Additionally, the study identified NYCU's strong resilience against declining birthrate impacts, while noting that Taiwan's current public university tuition system undermined institutional financial stability and efficiency.

Keywords

Top University, Merger, Data Envelopment Analysis (DEA), Technical Efficiency, Pure Technical, Efficiency, Scale Efficiency, Economy of Scale, Economy of Scope

PDF

References

  1. Act Governing the Establishment of Endowment Fund at National Universities. (2015). The Laws & Regulations Database of the Republic of China. Retrieved from https://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?pcode=H0030025
  2. Agasisti, T., Yang, G.-L., Song, Y.-Y., & Tran, C.-T. T. D. (2021). Evaluating the higher education productivity of Chinese and European “elite” universities using a meta frontier approach. Scientometrics, 126(7), 5819–5853.
  3. https://doi.org/10.1007/s11192-021-03978-z
  4. Ali, A., & Gittelman, M. (2016). Research paradigms and useful inventions in medicine: patents and licensing by teams of clinical and basic scientists in Academic Medical Centers. Research Policy, 45(8), 1499–1511.
  5. https://doi.org/10.1016/j.respol.2016.03.015
  6. Andrews, M., Duncombe, W., & Yinger, J. (2002). Revisiting economies of size in American education: Are we any closer to a consensus? Economics of Education Review, 21(3), 245–262.
  7. https://doi.org/10.1016/S0272-7757(01)00006-1
  8. Banker, R. D., Charnes, A., & Cooper, W. W. (1984). Some models for estimating technical and scale inefficiencies in data envelopment analysis. Management Science, 30(9), 1078–1092.
  9. Baumol, W. J., Panzar, J. C., & Willig, R. D. (1982). Contestable markets and the theory of industry structure. Harcourt Brace Jovanovich.
  10. Bonaccorsi, A., Belingheri, P., & Secondi, L. (2022). Economies of Scope between Research and Teaching in European Universities. Mathematics, 10(1), 42. https://doi.org/10.3390/math10010042
  11. Charnes, A., Cooper, W. W., & Rhodes, E. (1978). Measuring the efficiency of decision making units. European Journal of Operational Research, 2(6), 429–444.
  12. Chavas, J., Barham, B., Foltz, J., & Kim, K. (2012). Analysis and decomposition of scope economies: R&D at US research universities. Applied Economics, 44(10–12), 1387–1404.
  13. https://doi.org/10.1080/00036846.2011.556590
  14. Chen, C. R. (2020a). Efficiency analyses of higher education in Taiwan: Implications to higher education crisis. International Journal of Business, Human and Social Sciences, 14-6, 486–495.
  15. https://doi.org/10.5281/zenodo.3989136
  16. Chen, C. R. (2020b). Effect of merger on efficiencies: A study on Taiwanese higher education. International Journal of Business, Human and Social Sciences, 14-6, 480–485. https://doi.org/10.5281/zenodo.3989117
  17. Chen, C. R. (2024a). Financial Performance Evaluation of Top Universities Following the Mergers. International Journal of Learning and Teaching, 10(1), 178–193. https://doi.org/10.18178/ijlt.10.1.178-193
  18. Chen, C. R. (2024b). Whether Post-Merger Higher Education Institutions Operate Efficiently in the Long-Run? A Follow-Up Study in Taiwan. International Journal of Learning and Teaching, 10(1), 70–89.
  19. https://doi.org/10.18178/ijlt.10.1.70-89
  20. Daraio, C., Bonaccorsi, A., & Simar, L. (2015). Efficiency and economies of scale and specialization in European universities: A directional distance approach. Journal of Informetrics, 9(3), 430–448.
  21. https://doi.org/10.1016/j.joi.2015.03.002
  22. Duch Brown, N., Parellada-Sabata, M., & Polo-Otero, J. (2010). Economies of scale and scope of university research and technology transfer: A flexible multi-product approach (IEB Working Paper 2010/51). Institut d'Economia de Barcelona.
  23. http://ieb.ub.edu/wp-content/uploads/2018/12/doc2010-51.pdf
  24. Estermann, T., & Pruvot, E. B. (2015). The rise of university mergers in Europe. International Higher Education, (82), 12–13.
  25. https://doi.org/10.6017/ihe.2015.82.8867
  26. Farrell, M. J. (1957). The measurement of productive efficiency. Journal of the Royal Statistical Society: Series A (General), 120(3), 253–290.
  27. Frølich, N., & Stensaker, B. (2021). Mergers and missions: Investigating consequences for system diversity. Higher Education, 82, 411–434.
  28. https://doi.org/10.1007/s10734-021-00730-7
  29. Johnes, G., & Johnes, J. (2016). Costs, efficiency, and economies of scale and scope in the English higher education sector. Oxford Review of Economic Policy, 32(4), 596–614. https://doi.org/10.1093/oxrep/grw023
  30. Johnes, J. (2014). Efficiency and mergers in English higher education 1996/97 to 2008/9: Parametric and non-parametric estimation of the multi-input multi-output distance function. The Manchester School, 82(4), 465–487.
  31. https://doi.org/10.1111/j.1467-9957.2012.02329.x
  32. Johnes, J., & Tsionas, M. G. (2019). Dynamics of inefficiency and merger in English Higher Education from 1996/97 to 2008/9: A Comparison of Pre-Merging, Post-Merging and Non-Merging Universities Using Bayesian Methods. Manchester School, 87(3), 297–323.
  33. https://doi.org/10.1111/manc.12262
  34. Koshal, R. K., & Koshal, M. (1999). Economies of scale and scope in higher education: A case of comprehensive universities. Economics of Education Review, 18, 269–277.
  35. Kyvik, S., & Stensaker, B. (2013). Factors Affecting the Decision to Merge: The case of strategic mergers in Norwegian higher education. Tertiary Education and Management, 19(4), 323–337.
  36. https://doi.org/10.1080/13583883.2013.805424
  37. Liu, Q., Patton, D., & Kenney, M. (2018). Do university mergers create academic synergy? Evidence from China and the Nordic Countries. Research Policy, 47(1), 98–107. https://doi.org/10.1016/j.respol.2017.10.001
  38. Liu, Q., & Turner, D. (2019). The “Double First-Class Initiative” in China: Background, Implementation, and Potential Problems. Beijing International Review of Education, 1, 92–108.
  39. https://doi.org/10.1163/25902547-00101009
  40. Lo, W. Y. W., & Hou, A. Y.-C. (2020). A farewell to internationalisation? Striking a balance between global ambition and local needs in higher education in Taiwan. Higher Education, 80(3), 497–510.
  41. https://doi.org/10.1007/s10734-019-00495-0
  42. Ministry of Education. (2003). Report on the implementation of the program for promoting academic excellence of universities and the program for improving university fundamental education. Taipei: Ministry of Education.
  43. Ministry of Education. (2017a). Higher Education SPROUT Project (final version). Taipei: Ministry of Education.
  44. Ministry of Education. (2017b). Sustained Progress and Rise of Universities in Taiwan (SPROUT) Project official web.
  45. https://sprout.moe.edu.tw/SproutWeb/Home/Index/en
  46. National Yang Ming Chiao Tung University official web. (n.d.). https://en.nycu.edu.tw/about/
  47. Oleksiyenko, A. V., Chan, S.-J., Kim, S. K., Lo, W. Y. W., & Manning, K. D. (2021). World Class Universities and International Student Mobility: Repositioning Strategies in the Asian Tigers. Research in Comparative and International Education, 16(3), 295–317. https://doi.org/10.1177/17454999211039298
  48. Olivares, M., & Wetzel, H. (2011). Competing in the higher education market: Empirical evidence for economies of scale and scope in German higher education institutions (Leading House Working Paper No. 70). University of Zurich, Department of Business Administration.
  49. http://repec.business.uzh.ch/RePEc/iso/leadinghouse/0070
  50. Papadimitriou, M., & Johnes, J. (2019). Does merging improve efficiency? A study of English universities. Studies in Higher Education, 44(8), 1454–1474. https://doi.org/10.1080/03075079.2018.1450851
  51. Pritchard, R. M. O. (2022). Competition within a multi-campus, merged university – a zero-sum game? Irish Educational Studies, 43(1), 1–19. https://doi.org/10.1080/03323315.2021.2019086
  52. Puusa, A., & Kekäle, J. (2015). Feelings over facts – a university merger brings organisational identity to the forefront. Journal of Higher Education Policy and Management, 37(4), 432–446.
  53. https://doi.org/10.1080/1360080X.2015.1056602
  54. QS Quacquarelli Symonds. (n.d.). QS World University Rankings: Methodology. Retrieved June 16, 2024, from
  55. https://www.topuniversities.com/world-university-rankings/methodology
  56. Ripoll-Soler, C., & de-Miguel-Molina, M. (2019). Higher education mergers in Europe: a comparative study of the post-merger phase. Tertiary Education and Management, 25(3), 255–271.
  57. https://doi.org/10.1007/s11233-019-09027-y
  58. Russell, L. (2019). Better outcomes without increased costs? Effects of Georgia’s University System consolidations. Economics of Education Review, 68, 122–135. https://doi.org/10.1016/j.econedurev.2018.12.006
  59. Safavi, M., & Håkanson, L. (2018). Advancing theory on knowledge governance in universities: A case study of a higher education merger. Studies in Higher Education, 43(3), 500–523.
  60. https://doi.org/10.1080/03075079.2016.1180675
  61. Salmi, J. (2009). The challenge of establishing world-class universities. World Bank. https://doi.org/10.1596/978-0-8213-7865-6
  62. Schiltza, F., & De Witte, K. (2017). Estimating scale economies and the optimal size of school districts: A flexible form approach. British Educational Research Journal, 43(6), 1048–1067.
  63. https://doi.org/10.1002/berj.3312
  64. Schimank, U., & Winnes, M. (2000). Beyond Humboldt? The relationship between teaching and research in European university systems. Science and Public Policy, 27(6), 397–408. https://doi.org/10.3152/147154300781781733
  65. Slade, C. P., Ribando, S., Fortner, C. K., & Walker, K. V. (2022). Mergers in higher education: it’s not easy. Merger of two disparate institutions and the impact on faculty research productivity. Studies in Higher Education, 47(6), 1215–1226. https://doi.org/10.1080/03075079.2020.1870948
  66. Taiwan's college and university affairs information disclosure platform. (n.d.).
  67. https://udb.moe.edu.tw/udata/Index
  68. Ursin, J., & Aittola, H. (2021). ‘It’s Not like Everything Changes Just with a Click on New Year’s Eve’: Perceptions on Educational Issues of University Mergers in Finland. Higher Education Policy, 34, 543–559.
  69. https://doi.org/10.1057/s41307-019-00151-3
  70. Wollscheid, S., & Røsdal, T. (2021). The impact of mergers in higher education on micro level processes – a literature review. Tertiary Education and Management, 27, 257–280. https://doi.org/10.1007/s11233-021-09074-4
  71. Wolszczak-Derlacz, J. (2017). An evaluation and explanation of (in)efficiency in higher education institutions in Europe and the U.S. with the application of two-stage semi-parametric DEA. Research Policy, 46(9), 1595–1605. https://doi.org/10.1016/j.respol.2017.07.010
  72. Wolszczak-Derlacz, J. (2018). Assessment of TFP in European and American higher education institutions – application of Malmquist indices. Technological and Economic Development of Economy, 24(2), 467–488. https://doi.org/10.3846/20294913.2016.1213197
  73. Wolszczak-Derlacz, J., & Parteka, A. (2011). Efficiency of European public higher education institutions: A two-stage multicountry approach. Scientometrics, 89(3), 887–917. https://doi.org/10.1007/s11192-011-0484-9
  74. Zeeman, N., & Benneworth, P. (2017). Globalisation, mergers and ‘inadvertent multi-campus universities’: reflections from Wales. Tertiary Education and Management, 23(1), 41–52.
  75. https://doi.org/10.1080/13583883.2016.1243256