Research carried out in British universities will be cut because it risks eroding infrastructure and staff pay, the head of England's funding council said this week.
Sir Howard Newby said: "The volume of research has to reduce. It is the very commitment to research - a professional commitment that often overrides economic considerations - that risks compromising the financial health of universities, the symptom of which is an unsustainable erosion in infrastructure and in staff pay and conditions."
Low morale caused by being dubbed "research inactive" will be also investigated by the Higher Education Funding Council for England as part of its fundamental review of the research assessment exercise announced this week.
Sir Howard said: "We are aware that there are widespread concerns about the impact of the RAE, particularly in terms of the funding implications and effects on institutions and individuals.
"We are committed to a full review, which will be wide-ranging and will focus on the best way forward for research assessment. The strengths and weaknesses of the current model will be thoroughly examined alongside those of alternatives. There will be no presumption in favour of the current system."
Sir Gareth Roberts, president of Wolfson College, Oxford, will lead the review, which will be conducted in partnership with the other UK higher education funding bodies.
Among its tasks will be to judge whether the RAE provides value for money. New grades could be introduced to further discriminate between departments currently given the highest rating, grade 5*.
The review will also consider how frequently assessment should take place, the eligibility period for different subjects and to what degree "research in progress" should be assessed. The possibility of a lighter touch assessment will be investigated.
Sir Howard announced the review - which forms part of a rethink of the entire research funding system - as the government's and Hefce's responses to the Commons select committee on science and technology's report on the RAE were published.
The funding council staged a spirited attack on the report, which criticised the RAE for ruining careers, distorting research practice and contributing to the closure of university departments. Hefce criticised aspects of the report as "assertion", "without supporting evidence" and "merely reporting hearsay".
But committee chairman Ian Gibson said: "Our report has struck a chord in the academic community and clearly rattled some cages.
"Hefce reckons we do not have the evidence for our conclusions. It is quite clear that it has lost touch with the academic community."