Why Can’t Colleges Control Their Costs?

[Excerpt] Over 30 years ago William Bowen (1967) studied data from a set of selective private institutions and concluded that their tuition levels had been rising, on average, by 2 to 3 percent more annually than the rate of inflation ever since the turn of the 20th century. He attributed this partially to the increased specialization of knowledge and the growth of new fields of study. But first and foremost, this occurred because the nature of the educational process did not permit academia to share in the productivity gains that were leading to the growth of earnings in the rest of society. I am going to claim in this paper that there are a number of forces, in addition to the ones that Bowen discussed, that continue to put upward pressure on tuition. These include the aspirations of academic institutions, our “winner take all” society, the shared system of governance that exists in academic institutions, recent federal government policies, the role of external actors such as alumni, local government, the environmental movement and historic preservationists, periodicals that rank academic institutions, and how universities are organized for budgetary purposes and select and reward their deans. After briefly discussing each of these forces, I will present some results from a survey I recently conducted of large research universities to obtain information on how they organize themselves for budgetary purposes. Finally, I will conclude with some thoughts on the steps that academic institutions themselves must take if they want to hold down their costs

Review of the Book \u3ci\u3eThe Davis-Bacon Act\u3c/i\u3e

[Excerpt] Armand J. Thieblot\u27s monograph is not the first study of the administration and impact of the Davis-Bacon Act; however, it certainly is the most comprehensive. Successive chapters of the book consider the history of the act, definitions and interpretations of key words in the legislation, its current administrative organization and enforcement, experience under it (including improper wage determinations), and its costs and inflationary impact. A set of case studies are then presented to document the existence of improper and excessive wage determinations. Finally, the book concludes with a discussion of the original rationale of the Davis-Bacon Act and its current-day relevance, a survey of contractors reporting their views of the act, and a set of conclusions and recommendations

The Flow of New Doctorates

[Excerpt] As noted by Bowen and Sosa, their projections of the supply side of the academic labor market, which are typical of those used in other studies, are based on a number of simplifying assumptions. Similarly, their proposed policy remedies to increase the flow of new doctorates, such as increasing financial support for graduate students and shortening the time it takes students to receive degrees, are made presenting only scanty evidence on the likely magnitude of supply responses to these changes. This essay, which draws heavily from my study (Ehrenberg 1991), reviews the academic literature and available data (from a wide range of sources) to summarize what we know about new doctorate supply and what we need to know to make informed policy decisions

Are Black Colleges Producing Today\u27s African-American Lawyers?

In past years, almost all of America\u27s black lawyers came from historically black colleges and universities because these schools were the only ones that would admit black students. Today, it appears that black colleges are producing increasingly fewer of the nation\u27s black lawyers

Retirement Policies, Employment, and Unemployment

[Excerpt] There is a growing consensus among economists that reliance on aggregate demand policies alone will not be sufficient to move the economy to full employment with a nonaccelerating inflation rate, and that policies which alter the structure of labor markets will be required. While obvious structural policies such as public sector employment programs and training programs are the focus of current debate, many other public policies affect labor markets in subtle ways which may well adversely affect the level and distribution of employment and unemployment. To help improve the inflation-unemployment tradeoff, policymakers should seek to marginally modify these policies, preserving their benefits while reducing their adverse labor market effects. To illustrate these points, this paper discusses the influence of public and private retirement policies on the level and distribution of employment and unemployment. I focus on the Social Security system (OASDHl), the Employee Retirement Income Security Act (ERISA), the amendment to the Age Discrimination in Employment Act that raised the permissible mandatory retirement age to 70, the Supreme Court decision in the Manhart case prohibiting sex differentials in employee pension contributions, and early retirement provisions negotiated in private collective bargaining agreements. Certainly, it would be difficult to criticize the intent of these policies. However, each of the public policies adversely affects the level or distribution of employment and unemployment. I conclude by noting several reforms of the method of financing the Social Security system which would reduce the system\u27s adverse labor market effects

Empirical Consequences of Comparable Worth

[Excerpt] To help focus subsequent debate, this paper presents a nontechnical survey of the small but growing empirical literature by economists on the consequences of comparable worth. I discuss in turn studies of the consequences of comparable worth on the male-female earnings gap, of its potential to affect adversely the employment of women, of its effects on the labor supply and occupational mobility of women, and of its effects on women and their families as a group. The survey is critical in nature and points to areas in which research is needed

Independent Colleges and Universities in a Time of Transition

[Excerpt] I am going to discuss the stresses that the American higher education system is now under, the changes that we have seen in American higher education over the last three decades - many which predate the great recession - and how CIC members have responded, and might respond in the future, to these changes. A message that I hope you will take away is that I believe you have a unique advantage relative to your public sector counterparts because of the difference in the governance structures and financial models under which you operate. I will conclude by speculating a bit about what the future will hold for all of us

What’s The Future of Public Higher Education? A Review Essay on \u3ci\u3ePublic No More: A New Path to Excellence for America’s Public Universities\u3c/i\u3e

[Excerpt] Every year I come across a few books or papers that I wish that I had written. Public No More: A New Path to Excellence for America’s Public Universities clearly is one of them. Coauthored by Gary Fethke and Andrew Policano (henceforth F&P), two longtime public business school deans (one of whom was also acting president of the University of Iowa), who are both very serious scholars with long publication records, Public No More paints a picture of a future for public research universities that is very different than what many people will want to see. And although its message is that the financial and governance models under which public research universities have operated under have broken down and that new models are required, I will argue at the end of this piece that private higher research universities face many of the same issues as their public counterparts, so their message is relevant to private research universities as well. While I do not always agree with F&P’s prescriptions, this is a book that deserves to be widely read by all people concerned with the future of higher education in the United States. In what follows, I outline the arguments found in Public No More interjecting my comments and concerns as I go along. As an economist specializing for many years in the economics of higher education, a former Cornell vice president and trustee, and most recently a member of the board of trustee of the 64 campus State University of New York (SUNY) system, I view higher education from a number of different perspectives and these will all be evident in this essay

Reaching for the Brass Ring: The U.S. News & World Report Rankings and Competition

[Excerpt] The behavior of academic institutions, including the extent to which they collaborate on academic and nonacademic matters, is shaped by many factors. This paper focuses on one of these factors, the U.S. News & World Report (USNWR) annual ranking of the nation’s colleges and universities as undergraduate institutions, exploring how this ranking exacerbates the competitiveness among American higher education institutions. After presenting some evidence on the importance of the USNWR rankings to both public and private institutions at all levels along the selectivity spectrum, I describe how the rankings actually are calculated, then discuss how academic institutions alter their behavior to try to influence the rankings. While some of the actions an institution may take to improve its rankings may also make sense educationally, others may not and, more importantly, may not be in the best interest of the American higher educational system as a whole. In the final section of the paper, I ask whether the methodology that USNWR uses to calculate its rankings prevents institutions from collaborating in ways that make sense both educationally and financially. My answer is, by and large, no, although I indicate that USNWR could encourage even more such collaborations by fine-tuning its rankings system. In short, although USNWR rankings cause institutions to worry more about the peers with which they compete than would otherwise be the case, the rankings should not prevent institutions from working productively towards common goals. Put another way, USNWR is not the “evil empire” and academic institutions should not blame USNWR for their failure to collaborate more

Reducing Inequality in Higher Education: Where Do We Go From Here?

[Excerpt] Differences in inequality in college enrollment rates across students from families of different socioeconomic levels have only marginally narrowed since the early 1970s. Moreover, students from lower-income families are much more likely to start higher education in two-year public colleges and public four-year institutions than are their higher income counterparts. Among students who initially enter four-year institutions, six year graduation rates of students from families with incomes of less than $50,000 are substantially less than the graduation rates of students from families with incomes of more than$75,000. Finally, at a set of our nation’s most selective private colleges and universities, the proportion of students coming from families whose family incomes are in the lowest two-fifths of the distribution of family income, averaged only about 10% in recent years. I begin in the next section by discussing some of the forces influencing public and private higher education in the United States in recent years that have worked against improving access and persistence of students from the lower tail of the family income distribution. Where students go to college may be as important as whether they go to college, as a considerable body of research shows that, other factors held constant, students who attend better-funded more-selective colleges earn higher post graduation earnings, with this effect being greatest for students who come from lower income families. Hence I also discuss why it became increasingly difficult for students from lower income families to enroll at top public and private institutions during the period. Spurred by public attention that has been drawn to the under representation of students from lower income families, both selective public and private universities have begun to institute policies to improve their access to talented students from lower income families. The next section discusses a number of these strategies and provides preliminary estimates for some of their success to date. Efforts have also been made to enhance college preparedness of lower income high school students and to provide them with improved information about college costs, the availability of financial aid, and prerequisites needed to succeed in college; a few issues related to these efforts are discussed in the following section. Finally, I speculate about directions that future institutional and public policies might take