Athletics, Academics, and the Financial Condition of U.S. Private Colleges

Abstract Many private colleges in the U.S. face financial difficulty. The role of athletics in the financial condition of U.S. colleges is subject to controversy. Supporters argue that collegiate sports draw students, improve student quality, and increase donor support. Detractors argue that athletics are costly and undermine the academic mission of the institution. In this paper, we examine metrics of athletic and academic quality to determine their effects on the financial health of a sample of U.S. private colleges. Our findings indicate that higher spending on athletics reduces an institution’s financial health and that academic quality increases an institution’s financial health

Who Pays for College Athletic Spending? An Examination of the Evidence

/sites/default/files/journals/4/articles/175/submission/thumbnail.jpgCollege athletics is a major business in the United States. Collegiate sports teams generate billions of dollars in revenues, but they also incur billions of dollars in costs, and for the vast majority of athletic teams, revenues do not cover costs. When athletic programs do not cover their costs, the institutional budget must fund these expenses. In this paper, we demonstrate that an institution’s athletic subsidy per student is dependent on the institution’s number of students. Further, we find that institutions where the athletic subsidy per student is high enroll a disproportionate share of students who are economically disadvantaged and less qualified academically.</p