Abstract Although it is well-known that public-funded research has contributed to economic development, even these days it is not clear how to support this research effectively. Tailoring the proper support system still remains a challenge for the government. Th is is also the case for research support for universities, which are one of the main “engines” of public-funded research. One possible answer is performance-based funding. Th is funding has recently come to be increasingly used by many countries. However, performance-based funding may have several inconveniences. Th is article will analyze the performance-based funding that has already been introduced in the Slovak Republic. Our research outcomes prove the fact that this system has resulted in an increase in publication performance, but at the same time in a higher orientation on quantity instead of quality with several new negative effects.