This dissertation explores and explains the organizational responses of Mexican public state universities to an ambitious incentive-based policy created by the federal government in 2001: "The Integral Program for Institutional Strengthening" ("PIFI"). Drawing upon literature on organizational-environmental relationships and on the policy logic of incentives, the external institutional as well as internal organizational factors that shaped responses were analyzed. Specifically, resource-dependence and neo-institutional theoretical perspectives were used as lenses to explore and explain the response processes and outcomes. In a sample of three public state universities with different organizational characteristics and governance arrangements, in-depth interviews, document review, and observations were conducted. Findings revealed that while some responses were "real," improving administrative processes and structures and promoting transparency and accountability, core academic practices for the most part remained highly traditional. Thus, the implementation of most of the academic reforms promoted by the PIFI Program was "symbolic" and superficial, not penetrating classroom practices. Also, in search for legitimacy and continuous support from the federal government, universities became isomorphic with each other and with the task environment, reducing organizational differentiation and limiting innovation. Contrary to the policy's official intent, which was to promote participatory and collaborative strategic planning exercises, the organizational responses led to the further empowerment of central administrators and of the "pifiologists" as response specialists, diminishing the influence and academic authority of faculty members and of collective decision-making structures. The research findings have both theoretical and policy implications on the use of incentives as tools to steer higher education systems. Especially important is to address the underlying assumptions of these policy instruments in the design, implementation, and evaluation stages, and to anticipate perverse organizational responses to minimize their impacts. Moreover, this research shows that the alignment of accountability measures with the construct of "academic quality" is determinant if incentive programs are to positively impact classroom practices. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com/en-US/products/dissertations/individuals.shtml.]