Academic Research International   Volume 1, Issue 3, November 2011         PSYCHOLOGICAL EMPOWERMENT AND ORGANIZATIONAL COMMITMENT IN THE MALAYSIAN PRIVATE HIGHER EDUCATION INSTITUTIONS: A REVIEW AND RESEARCH AGENDA Yuen-Onn Choong Faculty of Business and Finance, Universiti Tunku Abdul Rahman. MALAYSIA choongyo@utar.edu.my Kee-Luen Wong Faculty of Business and Finance, Universiti Tunku Abdul Rahman MALAYSIA wongkl@utar.edu.my Teck-Chai Lau Faculty of Accountancy and Management, Universiti Tunku Abdul Rahman MALAYSIA lautc@utar.edu.my ABSTRACT The main purpose of this paper is to examine the relationship between psychological empowerment and organizational commitment of academics in Malaysian Private Universities. The research is aim to appraise the existing literatures and eventually set the research agenda. Past studies revealed that there are relationships between the four cognitions of psychological empowerment: meaning, self- determination, competence and impact cognitions with organizational commitment. Furthermore, the extant literature also encapsulates the relationships between psychological empowerment and the three dimensions of organizational commitment: affective, normative and continuance commitment. However, results from the existing literatures are shown to be inconsistent. The paper concludes with suggestions for educational leaders to focus on enhancing psychological empowerment of impact, meaning, self- determination and competence cognitions in order to increase academic staff commitment within an organization. Successfully shaping the attitude of academics in private universities will lead to improvement of overall organizational performance. And, subsequently it will in transforming Malaysia from middle-nation income to high-nation income with both inclusive and sustainable. Keywords: Psychological Empowerment, Organizational Commitment, Economic Transformation Programme, Malaysia INTRODUCTION Background of the Private Higher Education Institutions in Malaysia The Ministry of Education Malaysia encouraged the practice of empowerment at both the private and public higher education institutions through promoting the switch from centralization to decentralization (Bahagian Perancangan dan Penyelidikan Pendidikan, 1995). Furthermore, the Malaysian government has also given highest priority to the higher education and training sector by allocating more resources through increase national budget for higher education. This reflects the government’s fundamental impetus in enhancing the nation’s human and intellectual capital. As early as 1990, there were about 200 private colleges but no private university in Malaysia. The Malaysian Government subsequently issued three educational bills to promote both public and private higher education institutions sectors in 1996 (Country Summary of Higher Education). The three educational bills are The National Council on Higher Education Bill, The Private Higher Educational Institutions Bill and The National Accreditation Board Bill. The introduction of these bills greatly impacted the development of the Malaysian private higher education institutions. From 1996 to 2010,