Public Universities: The Supply Side of Building a Skilled Workforce

Abstract

Over the past few decades, public universities have faced significant declines in state funding per student. We investigate whether these declines affected the educational and research outcomes of these schools. Declining funding induced public universities to shift toward tuition as their primary source of revenue. Selective research universities enrolled more out-of-state and international students who pay full fare and increased in-state tuitions, moderating impacts on expenditures. Public universities outside the research sector had fewer options to replace stagnating state appropriations, requiring diminished expenditures and increased in-state tuitions. We find suggestive evidence that cuts have negatively affected research, and more definitive evidence that they adversely affected degree attainment at both the undergraduate and graduate levels.

Keywords

• public universities
• state appropriations
• research outputs