THE CONTRIBUTION OF INSTITUTIONAL CHARACTERISTICS, STATE SUPPORT, AND ALTERNATIVE REVENUE TO THE SURVIVAL OF HIGHER EDUCATION INSTITUTIONS

Abstract

Amid declining state funding, do public universities seek alternative revenue streams to keep tuition and fees down? Is such diversification only a public university phenomenon? If both private and public schools are seeking new sources of revenue, then state appropriations may not be the impetus. Instead, institutional characteristics may have a greater influence. In addition, would those higher education institutions (HEIs) with a greater propensity to generate alternative revenue have a greater rate of survival? I examine HEIs by sector using the Integrated Postsecondary Education Data System (IPEDS) from fiscal years 2003–2004 through 2016–2017 and provide future researchers with guidance on its use. Controlling for different states’ policies, politics, and fiscal health, I find that institutional characteristics influence certain HEIs to seek alternative revenue streams and that these characteristics often strengthen the relationship between state appropriations and alternative revenue sources. Furthermore, the findings suggest that generating alternative revenue, as I define it, may play a role in the survival of HEIs.