Monday, December 13, 2010


Cost-Effectiveness, or Cost?

Friday’s IHE did a story featuring a report by Douglas Harris and Sara Goldrick-Rab that’s well worth reading in its entirety. In a nutshell, it measures the ‘productivity’ of various programs, using what boils down to dollars-per-graduate. Among other things, it suggests that call centers to nudge students into attending class have great bang for the buck, but that Upward Bound and similar programs are wildly expensive for what they achieve.

The goal of the study -- which is entirely to the good -- is to encourage colleges to base resource allocation decisions on actual effectiveness, rather than on what sounds good or what has usually been done. The authors break out two-year and four-year sectors -- thank you -- and actually define their variables. (Notably, the productivity decline over the past forty years has been far more dramatic in the four-year sector than in the two-year sector.) Even better, they acknowledge that most of the research done on various programs are done on those programs in isolation, rather than in comparison with each other. If we’re serious about dealing with limited resources, we have to acknowledge that money spent on program A is money not available to be spent on program B. It’s not enough to show that a given program helps; it needs to help more than its alternatives would have.

Broadly, the paper finds that outside of call centers, there isn’t much low-hanging fruit. It tackles the “fewer adjuncts or smaller classes” conundrum directly, finding that more full-time faculty leads to greater bang for the buck than do smaller classes. (It notes, correctly, that the evidentiary basis for this claim is thin, but at least it’s something.) Given the choice between full-timers teaching large sections and adjuncts teaching small ones, this paper suggests the former. Strikingly, it notes that the bang-for-the-buck of most student services and student service programs is terrible. The TRIO programs look particularly bad, with Upward Bound standing out as a conspicuous boondoggle.

I’m not sure I buy every argument in the paper, but it’s a great start.

It leaves out a critical factor in administrative decision-making, though, which is the sources of money for the various programs. If every dollar came from the same pot, then the bang-for-the-buck measure would be significant. But some dollars come from pots of their own. If a program is entirely grant-funded, and those grant dollars can only be used for that program, then the fact that those dollars could have been more productively used elsewhere is of only theoretical interest. (Put differently, if the choice is between program A and program B, that’s one thing. If it’s between program A and nothing at all, that’s something else.) As long as, say, Federal dollars will pay the entire cost for a given program, then my only concern is whether the program makes any positive difference at all. The question of relative payoff may make sense at, say, the Congressional level, but not here.

There’s also the question of the financial relevance of cost-per-degree. (I’ll leave aside the educational relevance, since that’s too easy. Yes, a degree should actually signify something. That’s why we need robust outcomes assessment. Noted.) My college, like most, doesn’t get funded by the degree. It gets funded by a set amount given by the legislature, plus student tuition. (It also subsidizes the credit-bearing side by profits from workforce development contracts, but that’s neither here nor there.) Tuition is by the credit, and the state appropriation is by the whim of the legislature and governor. In other words, while I can acknowledge the inherent goodness of student success, improved success may not pay for itself locally. In fact, it almost certainly won’t, since tuition covers less than the cost of educating a student, and graduation rates don’t affect our appropriation in any intelligible way.

That’s why I can understand the argument about full-time faculty, but not be able to do much with it. The dollars simply aren’t there. (Of course, we could try to divert money from, say, counselors to faculty, so the analysis isn’t entirely useless.) This is in contrast to the for-profits, where tuition more than pays for its attendant costs. That’s why the for-profits are as focused on student success as they are, and why they pioneered call centers. They capture their own gains. We don’t. Cost effectiveness is great, but if the cost accrues to the college and the benefits don’t, we can expect underinvestment. Doing otherwise would be irrational.

Notably, the study notes that the underlying “cost disease” of higher education as currently defined -- broadly, denominating currency in units of time -- more than swamps any savings to be had by adopting even the most rigorous use of comparative measures. (It also assumes, I think falsely, that call centers and similar “intrusive advisement” models have no negative effect on academic quality. Based on what I saw at Proprietary U, I’d suggest that students who discover that the college needs them more than they need the college will adopt attitudes of entitlement that will make academic rigor more of an uphill battle.) In other words, it addresses more intelligent short-term decisionmaking, rather than fundamental structural change. That’s useful as far as it goes, but it only goes so far.

Still, caveats noted, I have to give thumbs-up overall. Subjecting the claims of various campus constituencies to evidence-based analysis strikes me as worth trying. Diverting money from boondoggles to productive uses may not make all the difference, but it would certainly help. As someone who actually has to make certain budgetary decisions, I say thanks.

If, as you say, for-profits are focused on student success, do we have a measure? Say, comparable four-, five-, and six-year graduation rates?

I'm wondering about the loss in productivity you mention. Is that because fewer people are graduating, or fewer people are graduating in four years, or?

I wonder if there's good data on the percentages of students who work during the semester in different years. Also, it would be interesting if there were a way to measure student-preparedness in a meaningful way.
Trio may not give a good bang for the buck, but it's a service that's sorely needed. At my undergrad institution, it was one of many services, so perhaps it wasn't needed there as badly as my grad institution. (Of course, my understanding is that the McNair scholars group there, at the time of my graduation, had the largest number of PhD alum of any program.) At my grad institution, I was horrified to learn that if a student needed extra help and they weren't part of Trio, they had to pay for a tutor. There were no free tutoring services available on campus. I felt awful telling students that either they had to get help from me or they had to pay a tutor. And, as a consequence, had students drop the course.
The TRIO programs look particularly bad, with Upward Bound standing out as a conspicuous boondoggle.

I think what those programs are trying to do in inherently inefficient as they are trying to take kids ill prepared for college and help them to succeed. That's always going to be expensive and the outcomes will likely be mixed because of the tremendous challenges the students face in achieving their educational goals. It's one way the high schools cost shift to the colleges.

Also, while I didn't read the article, I wonder, did they weight the relative value of each degree in terms of employment after graduation? Because while some majors may be cheap to produce, they typically don't have very many marketable skills attached to them (liberal studies comes to mind) and that means you are just cost shifting job training to the employer. One of the reasons health programs and engineering programs are so expensive is that students actually learn how to do something. There's a need for those folks even if they are more expensive to produce. The value of that doesn't seem to be captured in your discussion of this article.
If "efficiency" is your metric, you're looking for students whom you expect to succeed, but are making some trivial mistake you can correct. Phone banks are exactly what you'd expect to work for cheap.

Programs that support at-risk students are by definition going to fail a lot.
So, what does that do to your nursing program??
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