The higher education system of the Socialist Federal Republic of Yugoslavia displayed three specific characteristics – a) non-integrated universities, b) absence of a federal ministry of education since the 1970s, and b) self-managed Communities of Interest as the decision-maker in the higher education system. Therefore, there was no direct connection between the universities and economic planning. The author considers this to be one of the causes of high unemployment of graduates and brain drain towards Croatia and Serbia. Twenty years after the dissolution of the SFRY, the universities are still not integrated, there aren’t any connections with the market, and the same problems prevail. This paper focuses on the flagship universities from Croatia and Serbia. The author uses the historical institutionalism framework, document analysis and the process tracing method in order to explain and connect these issues. As a conclusion, the author offers three solutions for the reorganization of non-integrated universities.
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