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The paper investigates the concept of academic freedom at higher education institutions. It hypothesizes that modern universities, even though claiming the 21st century-type academic freedom, are often mismanaged and suppressed by corruption, coercion and excessive administrative power. The result is the diminished academic freedom, deteriorated instruction quality and a lack of creative opportunities for the professors who are compelled to obey the rigid administrative regulations that make neither sense nor efficient operation of the university possible.