NCPA - National Center for Policy Analysis


October 1, 2007

College rankings -- such as U.S. News & World Report's (USNWR) "America's Best Colleges" -- have the potential to steer colleges towards quality improvement, say the authors of a National Bureau of Economic Research Working Paper.

According to the authors:

  • College quality ranking information leads to increases in expenditure in public colleges, most of which are funded by more state appropriations per student.
  • State appropriations per student are more responsive to USNWR rankings exposure if a state has more citizens who are politically active, care about higher education and buy USNWR from the newsstand.

However, a number of caveats underlie these findings:

  • For example, the funding increase in response to the USNWR exposure may affect college output, since recent research has shown that college completion rates are positively related to resources per student.
  • Another study has shown that accountability awards to secondary colleges in California have little impact on student achievement.

The authors suggest that it is too early to draw any clear implications from their current findings.  While they believe that responses in the financial variables they find represent real resources, and are not just manipulated statistics on paper, it is not clear whether the response of state appropriations is socially optimal.  Because the pressure to improve comes from public attention to media news, state governments may react to improve the dimensions emphasized in the news, but do nothing or even reduce efforts in improving more obscure items, such as faculty research.

Source: Les Picker, "Ranking Affects the Financial Resources of Public Colleges," NBER Digest, September 2007; based upon:  Ginger Zhe Jin and Alex Whalley, " In The Power of Information: How Do U.S. News Rankings Affect the Financial Resources of Public Colleges?" NBER Working Paper No. 12941, February 2007.

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