A BUSINESS MODEL IS SUPPOSED TO PASS A MARKET TEST. Pretending there's a reserve army of unemployed faculty willing to work for peanuts, and pretending to become an athletic powerhouse, makes the college administration look foolish.

The average salary for a full professor at [Northern Colorado] in 2004-05 was $68,583, according to a faculty study, which is about 40 percent less than what a full professor makes at CU-Boulder.

Many say the decline in salaries began when [Kay] Norton took over as president in July 2002. Norton - whose background is in law - led a reorganization of the university based on a business model to cut costs.

The university also opted to move up a step and become a Division I school in athletics. That, critics say, has led to a $604,000 loss in the athletic budget this year.

(Via University Diaries.)

The economists figure prominently in news accounts of the troubles. Northern Colorado offer a B.A. in economics, no B.S., no graduate programs, and theirs is a relatively small faculty which, as one might expect under the circumstances, is not highlighting its presence in Journal of Economic Theory or Oxford Economic Papers. All the same, the economics job market is not so miserable that faculty members cannot secure better pay for primarily teaching gigs at institutions with similar or higher selectivity. At headquarters, the "business model" apparently includes a planning obsession. It's possible to erect a locomotive with fewer plans than these.