Among the main findings are that competing budget items do not appear to “crowd out” education’s budget share. Court mandated K12 funding equalization has resulted in substantial increases in education spending within states, with over a quarter of the increase coming at the expense of public higher education. Attempts by public institutions to increase tuition or raise private funds are seen to trigger a cycle of future budget share cuts, calling into question what institutions can do as they rapidly spiral toward the private “high tuition” equilibrium. The sensitivity of higher education budget shares to observable state factors has increased over time and dynamic panel estimates indicate that states exercise more discretion over the determination of the higher education – K12 split than over other budgetary decisions.

Three additional findings are noteworthy. First, cross-cohort ethnic heterogeneity increases have led to funding shifts away from higher education. Second, the surging popularity of targeted, merit student-aid programs appears to have been in an effort to redistribute income to economically well-off families. Third, as more households in a state become eligible to receive federal Pell grants, states move aid away from institutions and toward students – sanctioning tuition increases to potentially capture increased student eligibility for federal grant aid.

Using a rich panel data set spanning 26 years that was assembled from a variety of sources, I estimate a variety of specifications to investigate the causes of the declines in these three budget share measures. Among the main findings are that competing budget items do not appear to “crowd out” education’s budget share, rather its fall is caused primarily by changes in the income distribution within states. Court mandated K12 funding equalization has resulted in substantial increases in education spending within states, however, over a third of this increase has come at the expense of public higher education.

Attempts by public institutions to respond to lagging state appropriations by increasing tuition or private fundraising efforts are seen to trigger a cycle of future higher education budget share cuts, which calls into question what politicians expect institutions to do in the face of budget difficulties, as the institutions rapidly spiral toward a private “high tuition” equilibrium. The sensitivity of higher education budget shares to observable state factors has increased over time and dynamic panel estimates indicate that states exercise more discretion over the determination of the higher education – K12 split than they do over other budget decisions.

Three additional findings indicate that states have taken advantage of the higher education finance system to achieve other goals. First, the increasing ethnic heterogeneity across the noncollege and college aged cohorts has led to a shift of funding away from higher education. Second, the surge in popularity of targeted, non-means tested student aid programs appears to have been in an effort to redistribute income to economically well-off families. Finally, states appear to have “gamed” the higher education finance system to take advantage of perverse incentives created by federal student aid programs. Specifically, as more households in a state become eligible to receive federal Pell grants, states respond by moving aid away from institutions and toward students – allowing tuition to rise and to capture increased eligibility for federal grant aid.

To take another example, concern that the ending of mandatory retirement, which became effective for tenured faculty in January 1994, would lead to an aging nonproductive faculty has led other researchers to examine how faculty research and teaching productivity, the latter measured by undergraduate student evaluations, have varied over the life cycle. More recently, researchers studied whether declining research productivity is related to the acceptance of an offer for an early retirement incentive. Finally, other researchers have looked at how faculty research productivity varies across cohorts, finding that when a scientist enters the labor market has a substantial effect on his or her productivity over the life cycle and that more recently educated cohorts are not necessarily more productive than earlier cohorts. While some studies have looked at the implicit role that PhD student production has on the quality rankings of PhD programs, to our knowledge no studies have focused on how the distribution of PhD student supervisory responsibilities varies across faculty members at a university. Our study uses data on all PhDs produced during a 7-year period at Cornell University to illustrate how researchers can study whether the degree of inequality in PhD student supervision across faculty members within a broad field of study, varies across fields, as well as what the determinants are of differences in PhD student supervision responsibilities across individual faculty members within each broad field. Of particular concern to us, given the elimination of mandatory retirement, is how faculty members’ productivity in the supervision of PhD students varies over their life cycles.

The information in this booklet comes from several sources, most published by the U.S. Department of Labor or the New York State Department of Labor. The authors are not lawyers and the information in this booklet is not professional legal advice. If you are experiencing a problem at work, please contact one of the agencies or organizations that we have listed in the back of this booklet. In many cases, it is also a good idea for you to talk to a lawyer who deals with labor and employment law issues. Many lawyers will meet with you to talk about your problem for free, and some will represent you for free.