In a cutthroat term where whipping out the institutional wallet was key to winning battles for academe's best minds, Harvard was often too slow on the draw.

As the world's wealthiest university refused to rev up a hidden "star system" of academic perks, some professors complained of stinginess, and one department faced high attrition in the face of an aggressively spending competitor.

And in undergraduate financial aid, as five peer schools staked themselves publicly to greater generosity, a conservative Harvard preserved its yield only by quietly backing into a price war.

At the bitter end of this tightfisted semester, the University did pledge to open higher education's largest pocketbook for financial aid--spurred by the threat of an undergraduate brain drain. Then it backed away from that pledge for a summer of calculating how much is just enough.

For Faculty tempted by high-dollar departments elsewhere, no change was apparent and a similar drain may still loom.

As universities everywhere try to build prestige by buying people, financial aid and faculty compensation outline a powerful truth: Harvard can no longer survive on the sidelines of higher education bidding wars.