Reduced higher ed spending doesn’t lead to disaster
By Norman Leahy | Monday, June 13th, 2011 | Policy, VirginiaVia Jim Bacon’s Wonk Salon comes a study of how cuts to higher education spending in Oklahoma did not result in the sky falling, the state’s economy going toes-up or any of the other horrors usually attributed to the possibility that colleges and universities might have to make do with fewer taxpayer dollars. The study covers some issues unique to Oklahoma (such as graduates leaving the state after they get that all-important sheepskin). But the conclusion the authors’ draw is more universal:
Using econometric models, we have strong statistical evidence that additional state investment in higher education does not yield additional economic growth. Related to the Bowen Rule, these findings are due in part to rampant inefficiencies and little in the way of results from how universities spend their money. Students are only modestly engaged, learn little, and frequently do not graduate. Economic benefits are difficult to realize when universities are not succeeding in widely enhancing human capital. Even when students succeed in graduating, many of Oklahoma’s graduates end up moving out of the state due to a general lack of labor market opportunities.
Our findings indicate that public fears and outcries over cuts in state appropriations for higher education are unfounded. State investment in higher education
is not an engine for economic growth as conventional wisdom holds. Rather than continuing to blindly pass money from taxpayers to university bureaucracies, Oklahoma would be well-suited to rethink its long-term economic growth strategy.
The lessons for Virginia’s political class are plain: increased higher ed spending is not a silver bullet. But cracking the bipartisan belief that more spending on higher education is always good, and more sheepskins are always better, will not be easy.
For more on this topic, check out our interview with Cato’s Neal McCluskey.
(Cross-posted at Score Radio Network)
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About the author
Norm Leahy has written about Virginia and national politics online since 2002, beginning with One Man's Trash (OMT), and continuing through Bacon's Rebellion (both the blog and the e-zine), Sic Semper Tyrannis, NBC12's Decision Virginia, Richmond.com and Tertium Quids. He is the chief blogger at "The Score" and a producer of "The Score" radio show as well as being a Washington Examiner contributor.
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Comments
3 Responses to "Reduced higher ed spending doesn’t lead to disaster"
My experiences here in Virginia was that when state funding went down, the lost revenue was replaced with increased tuition rates (I put three kids through college at ODU).
I do not think that Virginia striving to provide a high quality college education to her youth at reasonable rates of tuition is a goal that is unworthy of trying to attain/maintain.
When doing a little research on the subject of the migration of college graduates I believe I noted that Virginia benefited from a net plus of graduates educated elsewhere moving in when compared to those educated here moving out.
Little David,
Two points for you to ponder.
1 – My wife and I have no children, how much of our income should the state seize in order to educate your children?
2 – How many “Little David’s” could receive a collage education for the money UVA spent trying to protect Prof. Mann’s emails from the big bad Virginia Attorney General? How about “legitimate” FOIA requests?
Refugee,
My kids did not qualify for Pell Grants or use subsidized student loans.
I did however qualify for the income deductions and tax credits that all tax payers qualify for, which I was grateful for and which I considered quite generous.
I personally do not think there is anything wrong with our society providing assistance to anyone attempting to put themselves or their kids through college. I do think those attending college should have some significant skin in the game, that is that they are required to finance a good portion of the expense themselves instead of receiving their education for free (unless they qualify for merit based scholarships).
I understand where your position comes from, but I do not agree with it. I think how much you pay in taxes should be determined by what your income is in a progressive tax system. How much of what you pay in taxes goes towards funding colleges and universities should be determined by our representatives in Richmond.
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