Markets, governance, and university priorities: Evidence on undergraduate education and research

Abstract.

I investigate the effects of differences in market context and governance arrangements on undergraduate education and separately budgeted research at both public and private universities. Public universities faced with little competition and universities that rely heavily on government subsidies relative to tuition tend to have larger undergraduate enrollments, fewer small classes, lower graduation rates, and are more likely to engage in separately budgeted research than universities with the opposite characteristics. In addition, Catholic universities offer fewer small classes but have higher graduation rates than independent private universities, while other church-affiliated universities spend less on separately budgeted research.