At a crowded cocktail party in a Washington hotel, James M. Buchanan approached Karen I. Vaughn with a question that astounded her.

Buchanan, an economist with an international reputation who headed a research center at Virginia Polytechnic Institute and State University in Blacksburg, was restless. Did Vaughn think that the fledgling George Mason University in Fairfax County, where she taught, would want to hire him?

Vaughn doubted George Mason could offer Buchanan enough money, but she also knew that if it won him, he could put her young state-supported school on the academic map. She flew to Blacksburg a few days later, beginning a courtship that was to bring Buchanan to Northern Virginia 18 months later.

Why Buchanan was willing to leave an established university for George Mason -- and bring along with him six professors from his Center for Study of Public Choice -- is an illustration of how relatively unknown universities can hoist themselves into academic prominence through aggressive faculty recruiting.

The technique is not new. Stanford University, the University of Chicago and countless others did the same. But in an era of hard economic times for academia, George Mason's growth is unusual and comes with no apologies. "We want to be established," said George Mason President George W. Johnson, who calls himself a "venture capitalist of the university."

Buchanan, known for his novel analyses of the impact of government on society, is not the only academic superstar who has been drawn to George Mason by a competitive salary and hopes of shaping a new school. In Buchanan's case, his pay is nearly $103,000 for nine months, well above the $75,000 annual salary of Gov. Charles S. Robb and other top state officials.

There are other examples of the school's drive to add faculty. Despite the current national shortage of engineers, George Mason is hiring 22 during its current biennial budget, and nine were department chairmen at other institutions. The 15,000-student school is recruiting humanities scholars with the same zeal.

"They've been very aggressive in structuring a new program," said Evelyn Hively of the American Association of State Colleges and Universities. "It makes other institutions salute."

Educators at schools raided by George Mason say they hold no hard feelings, but there is some grumbling by faculty members whose departments have not been singled out for special status. "I wish I could convince them fellow professors that the university developing along those lines is good for them," said Robert D. Tollison, a Buchanan protege who makes $70,000 as director of the Center for Study of Public Choice.

When Buchanan approached her during the cocktail party at the annual American Economics Association meeting in December 1981, Vaughn said she wondered if he wanted an offer from George Mason merely to gain clout with Virginia Tech in salary negotiations. Buchanan says he doesn't remember whether that was his intent. Both agree they thought it was unlikely he would go to George Mason, a school whose aspirations had so far outstripped its achievements.

Buchanan, Vaughn and J. Wade Gilley, George Mason's senior vice president and the money man in the negotiations, tell what happened:

Vaughn and Gilley checked and found that Buchanan was indeed restless: His Center for Study of Public Choice, begun under another name at the University of Virginia in 1957, was not in step with the rest of Virginia Tech's economists and he had been pushed aside.

After telephone calls back and forth, Buchanan came to Fairfax during the spring to talk. A memorandum was drafted promising him and his colleagues space, moving xpenses and salary equal to what they got at Virginia Tech. Then Gilley learned the professors' average salary was $60,000 -- nearly a third more than the top-paid professors at George Mason. Buchanan then made $82,000. "That gave me a real scare," Gilley recalled.

Gilley went to Johnson, a former Temple University administrator with a doctorate in English literature who had been hired six years ago with a mandate to transform George Mason into a major state university. His reponse to the money question was direct: "If they're good enough, we'll pay them."

In what became the model for subsequent hirings, the university persuaded a foundation headed by a Northern Virginia banker to donate $400,000. Under Virginia's Eminent Scholars program, the state matched, dollar for dollar, the income from individual endowments.

So if George Mason raised $100,000 and earned 10 percent annual interest by investing it, the annual payoff was $20,000. The University of Virginia had been using the technique for years.

When Virginia Tech officials realized that Buchanan was serious about leaving, they tried to match the offer, but by that time, Gilley says, Buchanan was ready to move. The Washington area looked more attractive, especially because flights into the Roanoke municipal airport had been cut as a result of airline deregulation, leaving Blacksburg even more isolated.

So in fall 1983, a year after George Mason began to offer a doctorate in economics, Buchanan and company arrived on the Fairfax County campus. Arriving a year later was British economist Charles K. Rowley, who had been planning to go to Virginia Tech and had never heard of George Mason before Buchanan told him about it during a visit to England.

Buchanan also brought in Tollison, who had left Virginia Tech to run the Bureau of Economics at the Federal Trade Commission, then to teach at Clemson University.

"The people in the economics department were glad to get rid of us," said Buchanan. "We were troublemakers for them."

John M. Perry, Virginia Tech vice provost, said the school is "always unhappy about losing good scholars" but he said there is no animosity toward George Mason. "They're trying to become a better institution, and more power to them."

Gilley said Buchanan attracted $800,000 in corporate money for research within 10 months of agreeing to come to George Mason.

Vaughn, now chairman of George Mason's economics department, said Buchanan's arrival "gave us instant recognition" and brought higher quality students.

At professional meetings, she said, people no longer look at her name badge listing her school and ask: "Where is that?" The other day, she said proudly, she got a piece of mail intended for George Washington University. "Usually it's the other way around," she said.

George Mason is beginning to build an engineering faculty, and the recruiting is similar. John N. Warfield, senior manager of Burroughs Corp.'s university research program, saw an ad in a small monthly engineering newsletter saying that George Mason was seeking a director for its new Institute for Information Technology.

Warfield had thought of George Mason before going to Burroughs in 1983 from the University of Virginia, where the school's emphasis on physical engineering left little room for his interest in management and design practices. "They didn't know what we were doing and didn't bother to find out," he said of the Charlottesville school.

This time, late in 1983, he was intrigued enough to respond. The deal, a package that included two faculty colleagues from Charlottesville, brought him to Fairfax last July. His salary, now $94,350, was a cut from Burroughs, but "the main factors were really the working situation," he said.

Andrew P. Sage, Quarles professor and associate dean of Virginia's engineering school, also had heard of the goings-on at GMU. The university was founding a School of Information Technology and Engineering, which will begin in the fall with $3 million in corporate donations and $12.7 million from the state.

Sage approached the university through a friend in industry. He was offered an associate deanship, an endowed professorship and the chance to hire 20 new faculty members over two years.

Sage says he wanted more administrative power than he had in Charlottesville, liked the proximity to high-tech industry and government, and thought the school could win a national reputation. His annual salary, $108,780, was less than a rival offer from Texas, but he accepted. He arrived last July.

Gerald Cook, chairman of the Department of Electrical and Biomedical Engineering at Vanderbilt University, had heard of George Mason, too, but what "really got my attention was they'd hired Andy Sage and John Warfield." He visited Sage during a professional meeting last September.

Unlike Sage, he wanted to do less administration and more research in his field of robotics. Cook got the Earle C. Williams professorship, named after the chairman of BDM International who heads the George Mason Institute. It raised money from industry for five endowed professorships at the new engineering school.

George Mason is not always the winner in the faculty recruiting game. It just lost economist Dwight Lee, who came with Buchanan, to a more prestigious endowed chair, lighter teaching load and $25,000 raise at the University of Georgia. Mervin E. Muller, recruited from the World Bank to the engineering school, is leaving for a bigger job at Ohio State.

"We're in this raiding business," Gilley said, "but the measure of our success is that people are now raiding us."