Changing how the federal government reimburses states for foster care has been on the mind of reformers for more than 15 years. In an effort to advance the debate, the Department of Health and Human Services published an issue brief in 2005 that examines the relationship between federal Title IV-E funding and child outcomes at the state level. The…

The techniques for calculating marginal costs in higher education are examined in detail. Marginal costs, as defined in economics, is the change in total cost associated with producing one additional unit of output. In higher education, the most frequently selected unit of output is a full-time-equivalent student or, alternatively, a student…

Cost per student disparity is examined with focus on: the concept of educational cost per student; dispersion of unit cost; cost comparisons among similar institutions; cost comparisons among the states; and institutional differences in the internal allocation of expenditures. Academic freedom, program variety, and institutional objectives may…

Results of empirical studies of the size-cost relationship in higher education are synthesized, with emphasis on comprehensives, standardization, and mathematical integration. Results of research on economies of scale at two- and four-year colleges and research are summarized as follows: (1) two- and four-year colleges, on average, do experience…

The question of what American colleges and universities should spend to educate their students is addressed. Both societal and institutional factors that determine the costs of colleges' educating their students and longitudinal changes in the unit cost of higher education are examined. The following issues are considered: long-term trends in unit…