Performance incentives and public college accountability in the United States: a quarter century policy audit

The allocation of funds to public colleges based on performance criteria rather than activity or enrolment criteria is often described as performance funding. In the United States, performance funding policies have become a frequently used instrument of higher education accountability. The history of such policies, however, is a complex one, with some states implementing such policies while others discontinue them. This paper describes and evaluates the first and the longest-standing performance funding policy in the United States, one designed and implemented in 1980 and remaining in effect for over 25 years.