I’ve previously shared an amazing chart that shows how more government spending on public schools has yielded zero positive results.
Well, it seems that government spending on colleges and universities also leaves a lot to be desired.
Three academics investigated the relationship between higher-education spending and economic performance and it turns out that this perverse form of redistribution from poor to rich is counterproductive. Here’s the key sentence from the abstract.
Results from a series of fixed-effects regressions using a 1992-2002 panel of state-level data indicate that increased spending on higher education generally exhibits a relatively large negative effect on private sector employment or gross state product growth when the increase in education spending is financed through own-source revenue.
Yet Obama and most of the other politicians in Washington want to increase the subsidies for colleges and universities – even though the macroeconomic effects are dismal.
But I guess that doesn’t matter since politicians seem more concerned about creating more comfortable lives for unproductive professors and bloated school bureaucracies.
By the way, let’s not forget that students also suffer. As the federal government has squandered more money on higher education, colleges and universities have responded by jacking up tuition and fees, leaving more and more students deeply in debt.
[…] on more bureaucracy rather than anything that would improve educational outcomes for students (or generate spin-off benefits for the overall […]
[…] There’s even academic research showing that government spending on higher education has a negative impact on economic […]
[…] There’s even academic research showing that government spending on higher education has a negative impact on economic […]
[…] It also turns that all these subsidies have a negative correlation with private-sector […]
[…] In terms of perverse results, it’s hard to imagine a more convoluted sector than higher education, where government intervention causes higher tuition and transfers wealth from the poor to the rich. […]
[…] more depressing, the research also shows that all this spending doesn’t improve human capital, so there’s a negative impact on […]
[…] We should also remember that there is such a thing as too much “investment” in higher […]
[…] Well, the same unhappy story exists in the higher-education sector. Simply stated, there’s been an explosion of spending, much of it from Washington, yet the rate of return appears to be negative. […]
[…] Well, the same unhappy story exists in the higher-education sector. Simply stated, there’s been an explosion of spending, much of it from Washington, yet the rate of return appears to be negative. […]
[…] Higher education? Nope. […]
[…] Higher education? Nope. […]
The big question now is to actually try to envision what on earth “lean” higher ed looks like. Online Learning is great but is *not* for everybody. For some learners, classroom contact is still necessary. Up against the minimums expected by accreditors, what would truly lean higher ed look like and how could I get it running?
This bubble is going to burst too… Look at two big ways that the govt. spent money pre-recession and the consequences:
1. Subsidies for people that could not afford homes to be able to buy them
2. Subsidies to universities and loans so that everyone can go to college
I personally visited many of the abandoned homes as a Real Estate agent. Total waste as almost all were trashed. All these kids have a college degree that means almost nothing when compared to what it did when I graduated and by all accounts about a fourth of the education I received….