• Studies question effectiveness of state performance-based funding | Inside Higher Ed

  tags: higher ed performance funding

  • Several papers presented here at the annual meeting of the Association for the Study of Higher Education explored what Michael McLendon of Southern Methodist University called the performance-based funding "craze," which has become a widely embraced and copied strategy for governors and legislators trying to improve the effectiveness and efficiency of their public higher education systems at a time when they lack either the money (or the will) to spend more on them.

  • The session at which three of the papers were presented broadcast their overall findings in its title: "The Myth of Performance-Based Funding." One paper, by Tiffany Jones of the Southern Education Foundation, examined the extent to which historically black colleges are especially likely to be hurt by state policies that link funding to simple metrics (like graduation rates) that don’t take into account the academic preparation of colleges’ students and their levels of institutional funding.

  • performance-based funding systems and concluded that they are sometimes ill-defined and overly narrow, and that they too rarely anticipate (and try to guard against) unintended consequences that can result.

  • examined performance-based systems in 19 states and found that while those programs were largely designed to increase the number of students completing associate degrees, it did so in only four of them. In six states completions actually declined, and in nine others, the patterns were inconclusive

  • Another study by the same authors uncovered similar results for bachelor’s degree productivity, with a positive impact in four states, a negative effect in four, and no effect whatsoever in 12 others.

  • Earlier analyses have suggested that one of the major limitations on the impact of performance-based funding is that many of the first major round of such programs were restricted to relatively small amounts of state appropriations to public colleges, and therefore may have been too constrained to change institutional behavior.

  • Tandberg said that many advocates for performance-based funding argue that the programs’ effectiveness will grow as the state appropriations linked to them does, and that it was too early to gauge the success of the most recently enacted performance-funding systems, which tend to have higher stakes. "The jury’s still out on Performance Funding 2.0," he said.

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