College Rankings Don't Contribute to the 'Academic Arms Race'

Contrary to a recent essay, the U.S. News rankings don't encourage colleges to spend unnecessarily.

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Richard Vedder, economics professor at Ohio University, recently published an essay ( "Going on a Diet," in Inside Higher Ed) that lists 10 ways the current economic downturn might affect colleges, including "bigger teaching loads, more unionization, a truce in the athletics arms race, and a slowing in college presidents' pay." Vedder says the deepening recession will likely mean that colleges will have to cut costs since it's unlikely, in his view, that revenue shortfalls can be made up via tuition increases.

One of Vedder's ideas is a call for a slowdown in the "Academic Arms Race":

"It seems the president of every mediocre American college wants buckets of money to allow that institution to get to 'the next highest level,' an impossible dream for all but the very few. Financial exigencies will scale such cost drivers as building luxury quasi-country club-like facilities and hiring superstar prima donna professors who teach little but demand a lot. The abatement will be temporary, however, until such time as we find a better means of measuring institutional performance than the U.S.News & World Report rankings."

Vedder's point implies that there is direct linkage between colleges' efforts to increase their position in our rankings and the rise in unnecessary spending on luxurious facilities by certain colleges. This is not the case. The financial resources calculation used in the college rankings specifically excludes spending on auxiliary enterprises such as residence halls, food services, student health services, intercollegiate athletics, college unions, college stores, and hospital services—the kind of spending that Vedder mentions as being potentially lavish.

Financial resources do count for 10 percent of the overall ranking in the methodology and are the main indicator to determine the resources—measured in terms of dollars spent per student—that the schools spend on their academic programs for the education of each student. A school with great financial resources can spend money well beyond the tuition that the students pay to enable the college to offer a much richer and broader educational program (classes and activities) than can a school that is essentially tuition dependent. U.S. News has not yet heard a college president say that deep budget cuts will not impact the quality of the academic program at his or her institution. In other words, a school that is able to spend more money per student on its educational program is more likely to produce a higher quality academic program than a school that spends less money per student.

It's important to point out that Forbes, in conjunction with Vedder—who is also director of the Center for College Affordability and Productivity—in 2008 published college rankings using a very different methodology than U.S. News does. In the future, this blog will offer more comments on the Forbes college rankings.