Thursday, October 12, 2006

Does Public Funding for Higher Education Matter?

Abstract: "This study uses panel data to examine the direct link between state funding and graduation rates at four-year institutions. When other factors are held constant, a $1,000 increase in state appropriations per FTE student at four-year public institutions is associated with about one percentage point increase in graduation rates. This positive link appears to hold for all research/doctoral, master’s, and baccalaureate institutions. In addition, there is evidence that a slow increase (or a decrease) in state funding seems to be associated with a fast increase in the tuition rate charged at four-year public institutions, which likely result in a negative impact on graduation rates further. Simply put, there is no such a thing as free lunch when it comes to graduation rates at public higher education institutions." Source: Cornell Higher Education Research Institute

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