Author Topic: Is ND's higher education system worth it?  (Read 1053 times)

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Offline Sal Atticum

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Is ND's higher education system worth it?
« on: October 30, 2009, 11:25:55 am »
Some would say no:

Quote
Richard Vedder, Athens, Ohio, column: N.D.’s focus on higher education hurts state

By Richard Vedder

BISMARCK — Gov. John Hoeven and other state leaders have presided over a huge increase in higher education spending in North Dakota, arguing that universities are engines or economic growth and prosperity.

By any measure, North Dakota spends far more on its universities than the typical state — state appropriations per capita in 2008 were 57 percent above the national average and well above those in any bordering state. North Dakota leads the nation in the population-adjusted number of four-year state universities.

Has or will the Hoeven strategy work? A new study the Center for College Affordability and Productivity has done for the North Dakota Policy Council suggests the answer is “no.”

Despite a strong historic state financial commitment to higher education, North Dakota has not been viewed as a particularly attractive play to live and work by many, having a high outmigration rate (even relative to neighbors like South Dakota).

North Dakota has the dubious claim of being America’s only state with a lower population today than in 1920 (the typical state has tripled in population).

National evidence shows that the positive relationship between spending on state universities and economic growth that Hoeven hypothesizes simply does not exist. The top 10 states in terms of economic growth from 1990 to 2008 had state higher education appropriations nearly 20 percent lower per capita than in the 10 lowest growth states.

More sophisticated statistical analysis reaches similar conclusions: More higher education spending has no positive impact on average incomes and quite likely a negative one.

Subsidizing universities means taking money from highly productive citizens in the private market economy and giving it to a sector that some evidence shows has had no productivity growth for the last four decades. Moreover, there is no solid evidence that higher university research spending has any positive growth effect.

By some measures, North Dakota seems to get less “bang for the higher education buck” than most states. While the state is well above national averages in public spending on higher education, it is below that average in terms of the percentage of the adult population with college degrees. While a modestly larger proportion of 18- to 24-year-old North Dakotans are in college than the national average, that does not translate into more adult college graduates.

For the North Dakota Policy Council study, we developed something called the “appropriations effectiveness ratio,” which has an average of 100 for the nation as a whole and, coincidentally, also for South Dakota, but a value of 67 for North Dakota (Minnesota was 101, Montana 134).

That ratio divides the number of adults with college degrees by the amount of state higher education appropriations.

It’s true one reason for North Dakota’s low score is outmigration of college educated persons. But that raises the question: Why should North Dakota taxpayers burden themselves to increase the human capital of other states?

Census bureau data reveal that from 1995 to 2000, North Dakota led the nation in the outmigration rate of young college-educated citizens. I doubt that migration patterns have altered dramatically since.

Increased spending on higher education does not have a positive economic payoff, but the taxes used to finance such spending have clear negative consequences on economic growth. North Dakota would be better off sharply reducing the higher education spending binge and devoting the savings to reducing the state’s tax burden.

The study can be found at www.policynd.org.

Vedder is director of the Center for College Affordability and Productivity and a professor of economics at Ohio University in Athens, Ohio.

Discuss.
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Offline Plantains

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Re: Is ND's higher education system worth it?
« Reply #1 on: October 30, 2009, 02:38:43 pm »
Thats highly interesting but 2 things.

1. I wonder if much of this high spending is due to Aerospace? I forgot how the statistic works, I was fairly confident that aerospace wasn't getting taxpayer money to fund it, but I'm not positive if that was initially, or still. In either condition, much more needs to be spent on a student here than at your typical university.

2. Again, outmigration would be directly related to Aerospace. The University offers a very special degree and has no jobs in the state within that degree (well... a very small #). Not to mention, I wonder how the huge amount of international students brought in by that program are statistized?

People here just seem to not have a great willingness to promote their state. Everyone knows I'm aviation when I say I'm from NY. No one really ever asks if I like it here (of course, this could just be the typical person thinking they have a complete understanding of the airline industry when they don't) or if I plan on staying? People do very much have the "if you don't like it get the hell out" attitude... and that's fine I suppose. But, pretty soon you'll have allowed or scared everyone away.
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