Do Universities Spend Enough of their Endowments?
Posted on September 9th, 2008 by CambridgeBlog in Economics, Law and Government
For the most part, they’re nonprofits. So can universities demonstrate their benefit to society?
A New York Times article yesterday reported on a meeting between university presidents and two members of Congress.
Senator Charles Grassley and Representative Peter Welch are both pushing the administrators to spend more of their endowment money to push down rising tuition costs.
Mission and Money: Understanding the University authors Burton Weisbrod, Evelyn Asch and Jeffrey Ballou contributed a report to this roundtable.
Read it below!
Don’t Mandate Minimum Payout Rates
Submitted to the United States Congress College Endowment Roundtable, September 8, 2008
It is comparatively easy to mandate minimum payouts from college and university endowments but much more difficult to ensure that such a mandate translates into more affordable undergraduate education. While we acknowledge the government’s right (and, indeed, responsibility) to examine whether nonprofit schools are providing socially valuable benefits that justify their favorable tax treatment, we also believe that the currently fashionable call for mandating minimum payout rates is a dangerous solution that is likely to do more harm than good. There are a number of reasons for this.
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