Ed Schools as Cash Cows in the University

Secretary Duncan is again on the stump today, at Teachers College (where I attended) where he is expected to make the case that education schools are “cash cows” of the university, generating large sums of tuition revenue which are then diverted to other parts of the university.


This proposition is hardly new, and appears to come from the pages of past TC president Arthur Levine in his report on ed schools a few years back.


(this is the one on preparing school leaders. there was also one on teacher education)

At the time, my colleagues and I were intrigued by a number of the assertions being made and engaged in a series of research projects trying to untangle the “realities”, but actually did not explore specifically the cash cow notion. But, our research from that time does have a few facts to offer with respect to the cash cow argument, as well as important general context issues.

First of all, who is producing the teachers, and administrators? One implication of the current rhetoric is that major universities like state flagship universities and major private universities which offer a diverse array of programs, undergraduate and graduate majors are also producing large shares of all teachers. As it turns out, the major research universities actually produced about 13% to 15% of teachers who were working in public schools in 2003-04 and 2007-08. 42% of public school teachers received their undergraduate training at regional comprehensive colleges, many of which were the former “normal schools” or “teachers colleges.” In many of these schools, education majors are the dominant major, perhaps helping to sustain the institutions, but with a minority of other program areas to draw on education tuition dollars – except by the role that liberal arts and science departments play in providing undergraduate credit hours to teachers in their content areas. But, this is revenue received for credits delivered – not a redistribution of profit margin, per se.

The role of education schools in major research universities is potentially more interesting, but again, ed schools in research universities produce a relatively small share of all teachers and that share appears to be declining. The same is true of graduate degrees in educational administration. In the early 1990s, regional comprehensive colleges produced about 3% of doctorates in educational administration, and now produce about 25% or more (as of 2003). That is, graduate degrees in educational administration are being increasingly produced by institutions whose primary goal is to produce educators and education related professionals. So, from these perspectives, it’s getting harder to see how ed schools or programs are substantially subsidizing other schools or programs within universities, when increasingly, the production of educators and educational leaders is being concentrated in schools focused on education.

I’m unsure whether there’s other evidence to contradict this pattern. I’ve not studied it for a few years. There is some evidence that small cash strapped formerly undergrad only liberal arts colleges have expanded delivery of online certificate programs including administrative masters degrees, but they are hardly a major producer yet. In fact, they’ve expanded production in areas such as MBAs even more so than teacher and administrator education.

Now, on to the basic premise laid out by Levine and echoed now by Duncan, that ed school tuition dollars subsidize the rest of the university. This could be the case if tuition was constant for a credit hour across all students in all units in the university and if the average cost of providing a credit hour to undergrads was lower for education students than for other students in the university. One might imagine this to be the case, if we assume that education faculty are simply less well paid, for example, than engineering, business or economics faculty and that ed school classes are large. Actually, the bigger driver of cost per credit hour produced is the class size piece.

A few years back Chris Morphew and I did an analysis of data from the National Survey of Postsecondary Faculty, estimating wage models and models of “cost per credit hour” by field in which those credit hours were delivered. We accounted for relative salary of similar rank faculty, share of salary to teaching and class sizes of average undergrad load of teaching faculty. We actually found that ed school credit hour costs were about average, comparable to business for that matter. While b-school salaries were higher, ed school class sizes were smaller, on average across the full range of undergrad courses. Next, we linked our credit hour cost estimates to course taking data on students in different majors to come up with estimates of the relative cost of producing and ed major versus an econ major, etc. based on the full mix of courses students take across units in a university and the relative price of those units. Again, cost of producing an ed major was relatively average – not low.

Now, there are factors we could not and did not consider with our limited data – including shares of undergrad credits delivered by teaching assistants  and whether this rate is significantly higher, or lower for ed schools. We also were unable to generate estimates of other “overhead” costs such as equipment that might be necessary in engineering or sciences, but this would hardly seem to compromise comparisons between ed schools and other areas such as social sciences that would seemingly have comparable non-faculty expenses.

That said, I’d be curious as to what other evidence is now out there to support, or refute this assertion that Duncan is now making. Here’s my preliminary reading list for anyone interested:
Morphew, C., Baker, B.D. (2007) On the Utility of National Data for Estimating Generalizable Price and Cost Indices in Higher Education. Journal of Education Finance 33 (1) 20-49

Baker, B.D, Orr, M.T., Young, M.D. (2007) Academic Drift, Institutional Production and Professional Distribution of Graduate Degrees in Educational Administration. Educational Administration Quarterly 43 (3)  279-318

Baker, B.D., Wolf-Wendel, L.E., Twombly, S.B. (2007) Exploring the Faculty Pipeline in Educational Administration: Evidence from the Survey of Earned Doctorates 1990 to 2000. Educational Administration Quarterly 43 (2) 189-220

Wolf-Wendel, L, Baker, B.D., Twombly, S., Tollefson, N., & Mahlios, M.  (2006) Who’s Teaching the Teachers? Evidence from the National Survey of Postsecondary Faculty and Survey of Earned Doctorates.  American Journal of Education 112 (2) 273-300