Recently The Chronicle of Higher Education included a chart based on data from the NCES’s recently released “Condition of Education, 2011” that raises some questions for those who are interested in the differentiation of educational product by sector.
The chart shows the amount spent per student on instruction, research and public service, and services and academic support. Part of the chart shows that “For-profit institutions spend far less on instruction than do other four-year colleges, and they spend almost nothing on research.” What caught my eye, though, was the contrast between four-year publics and four-year private nonprofits, both in the amount spent per student on instruction and the amount spent per student on services and academic support. It also offers an interesting lesson in interpreting data.
Let’s take the first statistic. Private nonprofits spend 62 percent more than public colleges and universities to teach a student. It’s tempting to conclude that private nonprofits invest more to teach a student than four-year publics and then to infer that students at private nonprofits get “more” for their investment than students at publics.
However, I suspect that some portion of the “extra” money spent per student at private nonprofits can be explained by dividing the total fixed costs of providing a bachelor’s degree by the number of students at the school. No matter how many students any school enrolls, public or private, there are certain costs that have to be borne.
For instance, producing one bachelor’s degree requires a minimum number of faculty and academic disciplines. Since public institutions have larger enrollments than private nonprofits, it seems certain that at least some of the difference in spending on instruction between the two sectors is due to the efficiency of spreading the same amount of fixed costs over a larger number of students at the publics.
One can make the same argument about the services and academic support spending. No matter how many students a school enrolls, there will be at least one registrar, one director of financial aid, one dean of admissions, etc. In addition, spending in this area includes residential living and associated student services for students who live on campus. If four-year publics have a smaller portion of their undergraduate students living on campus than private nonprofits do, then the spending in these areas when averaged over all students enrolled will make it seem like private nonprofits are less efficient than publics.
So do private students get more for their tuition dollar, or are public institutions more efficient in spreading their educational investment around? As you can see, despite the information provided by the Chronicle, we don’t really have a clear answer.
I love data as much as the next person—some of my colleagues would say I love data more than most people. But data like those presented in this article remind me that data almost always raise more questions than they answer. This case also illustrates why, whenever you conduct any kind of research on your students, campus, or market, you have to be very careful to not jump to conclusions and be thorough enough to explore all of the possible interpretations.
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