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Do Expenditures Other Than Instructional Expenditures Affect Graduation and Persistence Rates in American Higher Education?

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Author Info

  • Webber, Douglas A.

    ()
    (Temple University)

  • Ehrenberg, Ronald G.

    ()
    (Cornell University)

Abstract

Median instructional spending per full-time equivalent (FTE) student at American colleges and universities has grown at a slower rate the median spending per FTE in a number of other expenditure categories during the last two decades. We use institutional level panel data and a variety of econometric approaches, including unconditional quantile regression models, to analyze whether noninstructional expenditure categories influence first year persistence and graduation rates of American undergraduate students. Our most important finding is that student service expenditures influence graduation and persistence rates and their marginal effects are larger for students at institutions with lower entrance test scores and more lower income students. Put another way, their effects are largest at institutions that have lower current persistence and graduation rates. Simulations suggest that reallocating some funding from instruction to student services may enhance persistence and graduation rates at those institutions whose rates are currently below the medians in the sample.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4345.

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Length: 33 pages
Date of creation: Aug 2009
Date of revision:
Publication status: published in: Economics of Education Review, 2010, 29 (6), 947-958
Handle: RePEc:iza:izadps:dp4345

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Keywords: higher education; productivity; graduation rates;

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  1. Pfeifer, Christian & Cornelißen, Thomas, 2010. "The impact of participation in sports on educational attainment--New evidence from Germany," Economics of Education Review, Elsevier, vol. 29(1), pages 94-103, February.
  2. Jill M. Constantine, 1995. "The effect of attending historically black colleges and universities on future wages of black students," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 48(3), pages 531-546, April.
  3. SErgio Firpo & Nicole M. Fortin & Thomas Lemieux, 2006. "Unconditional Quantile Regressions," Textos para discussão 533, Department of Economics PUC-Rio (Brazil).
  4. Roland G. Fryer & Michael Greenstone, 2007. "The Causes and Consequences of Attending Historically Black Colleges and Universities," NBER Working Papers 13036, National Bureau of Economic Research, Inc.
  5. de Groot, Hans & McMahon, Walter W & Volkwein, J Fredericks, 1991. "The Cost Structure of American Research Universities," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 424-31, August.
  6. Dolan, Robert C. & Schmidt, Robert M., 1994. "Modeling institutional production of higher education," Economics of Education Review, Elsevier, vol. 13(3), pages 197-213, September.
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Cited by:
  1. Webber, Douglas A., 2012. "Expenditures and postsecondary graduation: An investigation using individual-level data from the state of Ohio," Economics of Education Review, Elsevier, vol. 31(5), pages 615-618.
  2. Smith, Jonathan & Pender, Matea & Howell, Jessica, 2013. "The full extent of student-college academic undermatch," Economics of Education Review, Elsevier, vol. 32(C), pages 247-261.
  3. Ehrenberg, Ronald G., 2010. "Analyzing the factors that influence persistence rates in STEM field, majors: Introduction to the symposium," Economics of Education Review, Elsevier, vol. 29(6), pages 888-891, December.
  4. Javier García-Estévez & Néstor Duch-Brown, 2012. "Student graduation: to what extent does university expenditure matter?," Working Papers 2012/4, Institut d'Economia de Barcelona (IEB).

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