Theoretical approaches to allocating funds in higher education

In the area of allocating funds in higher education, the key question is what happens in practice about the allocation of funding within the university. Does the allocation of internally-funded resources have an economic logic? Simply put, "What do budget allocators really mean when they allocating funds within a university? Budget allocator (for example, a government board or directors of the university), both as manager (and of course, the politician), whether they consider purely rational-economic aspects, or they also seek benefits in allocating financial resources. In this article, the problem that "how universities behave about the resource allocation process" was the basis for choosing different theories to explain the various aspects of this decision-making process regarding the allocation of resources within the university. In this paper, we review several theories that are appropriate for "explaining the basis of the distribution and allocation of financial resources within higher education." In this regard, although there are several theories about the university as an organization, but there are two theories that seem most appropriate to allocate resources to universities (especially government universities). These two are rational-political theory and critical-political theory. Also, two other theories (firm economic theory and resource dependency theory), which appear to be related to explaining the process of resource allocation within the university, have been investigated (but have been identified as part of the previous two theories and within them). At the end of the article, a comparison is made between these two theoretical approaches and by presenting the empirical evidence and findings of the allocation of funds within the higher education of Iran, we have analyzed and applied these two theories in higher education in the country and provided recommendations for higher education in Iran.