Ratchet effect - Wikipedia, the free encyclopedia

The Ratchet Effect: Fiefdom Bloat and Resistance to Declining Incomes (August 23, 2010)

The Ratchet Effect can be found in economies, societies and households facing declines in income and results (diminishing returns).

The Ratchet Effect is one key reason why meaningful reform of the status quo is impossible. In flush times, budgets expand as easily as waistlines, ratcheting up to consume ever-higher revenues. But once revenues start declining, the administrative/consumerist status quo is fiercely resistant to any reduction.

Like a body which has grown fat from excessive consumption, the status quo will resist any reduction in staffing or spending, sacrificing muscle to keep its layers of fat untouched.

Correspondent Kevin K. submitted this example of the ratchet Effect in higher education: Top ranks swelled at University of California at Davis:

UC Davis' administration fattened up in a way few other campuses nationwide could match from 1993 to 2007, with the third-highest increase in ratio of administrators to students among 198 universities.
UCD went from 3.2 full-time administrators per 100 students to 13.5. That 321.9 percent increase also was the highest in the 10-campus University of California system.

The figures are included in Administrative Bloat at American Universities: The Real Reason for High Costs in Higher Education.

Here is a telling tidbit from that report:

Arizona State University, for example, increased the number of administrators per 100 students by 94 percent during this period while actually reducing the number of employees engaged in instruction, research and service by 2 percent. Nearly half of all full-time employees at Arizona State University are administrators.
charles hugh smith-The Ratchet Effect: Fiefdom Bloat and Resistance to Declining Incomes