Episode 3

The guest discusses the influence of college rankings on higher education funding. The relationship between instructional salary and quality has evolved with a focus on research expertise. Temporary professors are hired to cut costs. In Canada, there are similar concerns about the cost of higher education. Rankings like US News increase expenditures on structures and scholarships. State governments and voters view universities as tools for economic development and competition. Universities attract big corporations, which in turn attracts more students. This creates a cycle of improvement. Welcome to Research and Rating, the show where we delve deep into the fascinating world of higher education, exploring the intricacies and impact of college rankings on student application and institutional dynamics. I'm your host, Adrian, and today we have a distinguished guest who brings a wealth of knowledge to this topic. Joining us is Professor Alexander Wally from the University of Calgary and the co-author of the enlightening study, The Power of Information, How do US News Rankings Affect the Financial Resources of Public Colleges. Professor, thank you so much for being with us today. Oh, thanks so much for the invitation, happy to share some thoughts. Yeah, I read your article, kind of made me switch gears towards, you know, how government funding plays a role in it. It was kind of interesting to see how public schools get their funding. My first question is, so in your research with Professor Jin, you mentioned that instructional salary is directly related to instructional quality. How has this relationship evolved over time, especially in the context of changing trends in higher education, where devoting lots of time to teaching is often looked down upon? Yeah, it's a great, great question. You know, I think there's a real big question there about how do academic labor markets work for instructors and faculty. You know, I think one thing that we're seeing in the very recent data, kind of after the study you're talking about, is the role of research and student learning. So what we've been seeing from other researchers is that the professors who are the most leading scholars in the area, kind of working on the most cutting-edge research, that actually benefits students. So students learn more and they get better jobs, and then they end up with higher earnings in the future themselves. So the kind of the human capital of the professor, how much they know and what their expertise is, they can translate that and transfer that to the student and provide more and more human capital to the student, which is actually going to benefit the student over a longer time period. Would you say that even though that kind of relationship between salary and ranking is definitely prevalent, but would you say that professors have shifted more towards research rather than instructional teaching? Yeah, I'm not sure if it's been a shift. I think it's been something that's been present for quite a long time in the United States and other countries. Professors are often sought out for their research expertise, and there's a lot of competition between universities to kind of get the best professors they can. Another part of the higher education funding is also research grants that come a lot of times from federal government, sometimes the state government, for different projects. And typically the researchers with the highest profile, kind of the most expertise, most publications are the ones that win those research grants. So a lot of the resources do flow to the research. But I'm not sure it's really changed. I think it's been like that for quite a long time period. One thing that has changed more recently, too, is you do see more temporary professors that are sort of adjunct positions or sessional positions. These are people who don't really have a permanent position at the university. They're not on what we call the tenure track or tenured faculty. And these individuals typically are not as active researchers. They're more focused on the instructional side. So you can kind of see it either way. It could be that research faculty sometimes are just really good at research but not very good instructors. And so that might be not so great for students. But that would be kind of the case for their substitutes. One, you're good at research but you're not good at teaching. But we typically think about them as complements. We typically think about those who have kind of the most expertise and are the frontier of knowledge have kind of the most to teach students as well. So we think about those kind of both going together. Yeah. That's kind of interesting. What do you think might have prompted more temporary lecturers? Yeah. I mean, I think part of the challenge is the funding environment in higher education is getting tougher. I think a lot of state governments are really asking universities, hey, we're really not seeing the value there. We're putting a lot of money into the university. But is this really such a great deal for us? We want to get costs down. Certainly, students and parents are feeling the tuition price is really different than it was a couple decades ago. So there's a lot of pressure there on universities to contain costs. And so when universities are trying to compete and trying to keep these very eminent research faculty, they have to find other ways to save money. And so the sessionals, kind of these temporary instructors, generally are paid less and they're generally getting less funding. So it is one way for the university to kind of cut back on expenditure. Yeah. Yeah. Would you say it's a little bit different, you teaching at the University of Calgary, would you say it's a little bit different in Canada? Yeah, it's a bit different. It's got a lot of similarities, though, to be honest. I mean, I think you have different faculty. Some faculty are more research focused. Some faculty are more teaching focused. There's definitely a lot of concerns about the costs students are paying. Tuition is quite a lot cheaper in Canada. It's quite a lot cheaper than the US. But still, students really feel it and they're really looking for ways to save money. And also the government is under a similar kind of mindset of we want to see higher education be a good value. You're putting a lot of tax dollars in there and you really want to see the value. So I think the questions of cost of higher education are a big deal for a lot of people. And so there's more pressure there, I think, around the world. Yeah. Yeah. Kind of similar. You also discussed how exposure to rankings like US News increased expenditures, kind of like we were just talking about, on structures and scholarships. Can you elaborate on specific mechanisms through which these rankings influence funding decisions in particular areas? Yeah, that's a great question. So one thing we studied was the launch of the US News rankings. So, you know, historically, universities weren't really ranked at all. It wasn't until the early 1980s where the US News rankings come online. And what we looked at was there's some universities that are always ranked. They're kind of like, you know, the very top universities. And what happens was over time, the rankings add new players to the mix. They add like a large number of universities that are a little bit lower ranked. And so we looked at what happens to them once they get added relative to other ones that are already in there. And what we see is they start spending more money. And so the idea we have is that, you know, state governments and voters really care about competition. They really are thinking about, you know, we want to be the best we can. We want to use universities as a way to develop and grow our economy. We think that having, you know, university research leads to startups and things like that. It also helps us attract talent. We can bring in these very talented individuals into our state, and that's going to help us develop it. So we really see that, you know, universities as a tool for economic development and different state governments are trying to compete. They're trying to win that race so they can be the one that kind of wins the next, you know, big company that launches in their area. So we saw recently Amazon launched a new headquarters, HQ2. I'm not sure if you've been following this, but they put out kind of this national ask of different places and said, you know, tell us why we should locate where we want to be there. And one of the factors they looked at was universities. They kind of looked at universities and they looked at places that had, you know, a good computer science department, a good university, and that kind of fed into their ranking. So it's like if you have a great university, maybe it helps you attract the next Amazon, which creates jobs in your economy and increases salary for people there. So that's kind of the idea behind that study is that, you know, this kind of thought process that trying to get big, highly paying employers to locate in your area, universities could be one factor for that. Yeah, that's kind of interesting because it's kind of, that kind of makes it like more of like a cycle because if the universities are, they're funding more research, then they're more attractive, as you were saying, to big corporations, which kind of in turn attracts more students because they see that the universities are very much involved with these big corporations. They always add this blurb where they show all the logos of where kids at schools are getting internships. So that's kind of interesting. I didn't even think about that. Yeah, I think that may make sense. Like it's sort of like a flywheel effect, right? You sort of, you get better a little bit, you attract more companies, you can get even better students, you can kind of get even better and even better, right? So there's kind of this idea that the rich get richer, you know, the ones that are like doing really well, kind of like really diverge from the ones that are they're not doing so well, and it kind of like builds on itself. So yeah, that's one of the questions. There's a famous quote by Daniel Patrick Moynihan, a former former US senator, and his quote is, if you want to build a great city, build a great university and wait 200 years. So it's kind of like this idea, you kind of get this early mover, you kind of like move first, kind of get ahead of the curve, and it kind of builds on itself. Yeah, yeah. Let's hear a word from our sponsors. When you play in the breeze, our campus ensures that only the most adventurous and aesthetically inclined students make the cut. Admissions requirements, a keen eye for beauty, ability to appreciate the sun in the sky, a commitment to enjoying life to the fullest. Who needs a 4.0 GPA when you can have a B-list 10 out of 10? Choose Paradise University because in the end, it's not about what you learn, it's about where you learn. Also, Paradise University ranks very high in the college universities. Now, let's get back to the podcast. Also note that US news are more influential in states where citizens are politically active, and I thought that was really interesting. Could you explain kind of the potential reasons behind this correlation and its implications for, you know, the relationship between political engagement and educational funding? Yeah, super. I mean, I think that's a big question. Like, a lot of voters are not necessarily engaged, and so the idea is that if these rankings are kind of affecting public spending through the sort of democratic channels, what we would expect is that areas where voters are more politically engaged, they're going to pick up on that information more. They're going to be more aware of how their state compares maybe to another state. They're also going to be pushing their government to do things that they really want to do. So if they think it's important to have really strong, you know, research universities, they're going to push for that. So I think it proxies both for, like, that level of political engagement among kind of the stakeholders of universities, and also maybe the information people are seeking out about how their state's comparing to others. Yeah, yeah. Do you think that in states where people are more invested in public funding, do you think colleges with perceived low quality will receive more funding? Yeah, I mean, it's just sort of a question of how people make up their mind. You know, it's like, are they concerned about inequality within their state? They might be really concerned that, oh, we don't want to have some colleges doing really well and some really struggling. So they might say, you know what, we want to pull up those ones that are kind of level up those ones that are struggling a little bit. On the other hand, it might be that they just want their state to have, you know, a university in the top 25 or something. So like, no, no, we'll put all our money into that leading one and try to, like, pull it up the most. So I think it's a little bit of a question of, you know, how those voters might think about that. Yeah, certainly. Yeah. So they definitely have more appropriations towards our increasing total expenditure. Yeah. We'll also kind of touch on private schools, even though that wasn't really the focus of the article. How would you say the impact of third-party rankings like U.S. news funding differ between private and public institutions? Yeah, it's a great question. Yeah, I think the private and public institutions, their governance is quite different, and their mission is quite different. So, you know, we see for private institutions, there's a strong focus on kind of the governing board, the alumni. There's a lot of focus on donations. How do you encourage people to donate to university? How do you take care of your alumni? So, you know, my thought is that probably private universities would be more responsive to the rankings. They're much more concerned about competition. You can see, you know, schools like Columbia, New York City, you know, they'd be really concerned that, oh, your ranking drops by one from one year, it goes up another one. They're really concerned about, okay, how do we rank versus, you know, MIT or Fordham? You know, they're really thinking about that pretty intensely. I think for public universities, they have kind of a broader mission. So definitely like research is one piece, but they're also supposed to be more engaged with their communities. So not just thinking about what's happening on campus, but what's happening more broadly in the state. How do they transfer technology? How do they support startups? You know, how do they engage more broadly with different alumni and students in different groups? So I think that what I would think is that probably the public ones are a little less thinking about that than the private ones. Do you think that kind of engagement with the community is communicated in the rankings? Not really. I don't think there's anything that really captures that in there. The formula really is about things like, yeah, how much do you spend? It's a lot about kind of what we would call inputs into the educational process. So how much do you spend? What are the SAT scores of students you have? What fraction of alumni kind of donate to university? It's really focused on those kind of metrics. The community-based metrics are really hard to measure. It's really hard to know how would you account for that? How would you quantify that? And so I think what U.S. News and other rankings has kind of pulled away from that and focused on more things where they can measure pretty well. So research outcomes we can measure pretty well. We can count the number of academic papers that professors publish at a certain university. We can count how many patents they have. That's like more straightforward. Things that are like more community-oriented are a little tricky. The Carnegie Association, they've been starting to push more on trying to figure out the community impact of universities, but I think it's an emerging area. Yeah, it's definitely less arbitrary to kind of measure some more quantitative. Yeah, the things that are more close to education, it's easier to measure. The further you want to go kind of downstream, it's much harder to know did higher education cause that or something else cause that. So things like the number of students you have at a university, it's like very easy to measure. Even when you start going to the next step and say, okay, how did that university affect their earnings in the labor market? How did that affect their salaries? Even that's like hard to tell because there's lots of other things that affect your salary. If you graduate in a boom time period, you could do pretty well. If you graduate in a recession, not going to be so good, but that's not really caused by the university, but it does affect students. So start teasing apart the effect of kind of the university from all the other stuff is a challenge. That's true. Yeah, it just kind of depends. Yeah. I guess my last question is, in your article, you talk about the role of quote-unquote academic capitalist practices in influencing students' choices, particularly in applying to out-of-state public schools. Yeah. How do you think these practices have evolved since the publication of your article, and do they continue to play a significant role in students' decision-making processes? Yeah, it's a great question. I think one thing we've seen happen over time is kind of the U.S. student market has become much more national. So it used to be, if you're thinking about the 50s and 60s, people might only apply to their state university in their own state. They're going to be close to family, they're going to stay there. Whereas now a lot of students are applying to universities across the nation, and they're trying to look for what's the right thing for them, right? I mean, they're trying to figure out what's it going to cost to go to different places. Do they have the major students want? Is it the kind of lifestyle that they want to be there? And then they're also thinking, yeah, what's the ranking look like? Is this kind of a comparable university? So, yeah, I think the cross-state students are probably even more sensitive to rankings, you know, because they can apply to any university in the country. So if you're living in New York State, you can apply to California, you can apply to Arizona, you can apply to Wisconsin, any of those places, but your choice of where to go isn't really driven by where your family is because none of those places have your family. And so you're really thinking about what's the educational experience like? Do I want to go to California or Wisconsin because of, you know, all the things that are related to universities? So probably those students, I would imagine, are even more kind of responsive to rankings than people just in their home state. Yeah, and it's definitely, I mean, it definitely benefits the colleges because you were kind of talking about this in the article, how oftentimes a lot of our state schools require, encourage out-of-state students because they're paying higher tuition. That's kind of, from my understanding, that's related to how much appropriation, how many appropriations they receive from the state. Yeah, absolutely. I mean, the fact that the out-of-state students pay more does make these financial concerns for the university lessened, right? It makes it easier for the university to have those students there. There have been some states that are capping the percentage of out-of-state students. So they're saying, look, you know, we're really concerned that, you know, too many students from out-of-state are coming into the university, and the university of our state is supposed to serve our residents, not, you know, people from different states or international students. There has been a little bit of pushback, but yeah, I think you're right. I think the international out-of-state students would be in that category. Yeah. Do you think it's the responsibility of the state schools to provide or cap how many out-of-state kids there are? In-state kids are obviously paying tax dollars to the state to pay for the schools. Do you think? Yeah, absolutely. It makes a lot of sense. I think the one big challenge we've had, though, is just that, you know, the appropriations, like the direct funding from the state government, have been falling over time, and certainly, like, relative to the number of students that's going up. So a lot of universities feel like they don't really have a choice but to look for out-of-state or international students because their costs are going up. You know, we have inflation. We've had inflation quite a lot over the last few years, and so that means their costs are going up. But a lot of times, like, the tuition, the in-state tuition is kind of, like, capped, and there's a freeze on in-state tuition in many states. So the universities are kind of saying that, hey, if you're not going to fund us, you know, enough money to run, we're going to have to find that revenue somewhere. So there's kind of two sides to it. I think it's a little tricky. Yeah, yeah. But I just want to say thank you so much for joining me and your expertise and insights were very invaluable. Yeah, it's been a pleasure to be here. Those are great questions, and I'm really glad that you read the article so carefully. Yeah, yeah. Thank you so much for joining me. Absolutely. It's been a lot of fun. Yeah, it was great meeting you.