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Market-Based Solutions to Vital Economic Issues

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Market-Based Solutions to Vital Economic Issues
Research
Apr 18, 2018

It’s How Much You Spend and Where You Spend That Matters

Abstract

Universities are under tremendous pressure related to declining resources, flat enrollments, and increasing stakeholder demands. Strategic questions are surfacing related to resource allocation – how to connect investments to outcomes in an increasingly competitive and dynamic environment. The Academic Benchmarking Consortium (ABC) was formed in 2014 to improve decision making in higher education by providing reliable benchmarking data. To date, 28 top universities have joined forces to compare their administrative spending, examine outcomes, and relate the findings to strategic plans. One recent area of analysis involved testing for correlations between overall administrative human capital investment and university rankings. While some of the findings were intuitive, such as higher ranked universities spend more per student than lower ranked universities, other findings were much more interesting. For example, where universities made their investments is also important, with several areas actually indicating negatively correlations to ranking (i.e. higher ranked universities spent less per student than lower ranked universities).


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