Economists have described the Twentieth Century as quintessentially both the "American Century" and the "Human Capital Century" (see Goldin and Katz 2008). Yet there is surprisingly little research that explores the details of the connection between the dramatic economic progress of the United States over the last 100 years and the role that postsecondary institutions have played. The proposed research is part of a longer-term project that will explore how public support for higher education has influenced American economic growth from 1870 to present. Over the past decade state and local governments have devoted an average of approximately seven percent of their revenues to support public higher education, today amounting to about $78 billion (SHEEO 2007, 45). The federal government also provides significant support for higher education, both directly to the institutions, but also to its consumers (students). The latest data compiled by the National Center for Education Statistics (Sonnenberg 2003) show that the federal government contributed $58.5 billion to postsecondary educational programs in FY 2003. Policymakers today often couch their support for higher education in the broad context of encouraging the development of high-technology or training a workforce that can compete in an increasingly global economy based on knowledge and information. Despite the oft-cited argument that public investment in higher education is central to a country's or region's economic progress, little research has explored the question. The proposed project will seek to fill this void by compiling and analyzing previously unexplored and very detailed data on the development of American colleges and universities from 1870 to 1940 ? a time period that Goldin and Katz (1999) dub the ?formative period? in the development of American higher education. The central questions this project will seek to answer include: What was the impact of the development of modern American research universities on local economic growth? What economic and political forces contributed to the rapid ascendancy of American research universities in the late nineteenth and early twentieth centuries? What was the nature of the competition between public and private colleges and universities in this early period that set the stage for their subsequent development? One of the primary objectives of the proposed research will be to collect, code, clean, and analyze previously unexplored data on individual public and private postsecondary educational institutions. The institutional-level data were published annually from 1870 to 1918 and biennially thereafter. The data we will be able to collect include the institution?s location, religious affiliation, year opened, numbers of faculty, students and graduates, total income, income from various sources, property, fellowships and scholarships, and private endowments. These data will be matched with decennial population, manufacturing, and agricultural census data based on the location of the institution in order to measure the economic impact of society's public and private investments in higher education.
Broader Impact The proposed research will broaden our understanding of the relationship between public investment in postsecondary education and research and economic growth. The institutional-level dataset that we will create and make public under the auspices of the grant will provide an invaluable source of information for other researchers interested in higher education in the U.S. and in discerning long-run trends in its historical development. Further, the results of the research will be relevant to policymakers today who grapple with very tight budget constraints and question the return to investments in public higher education. Finally, the research will employ numerous undergraduate researchers who hopefully will become interested in economics research and consequently decide to pursue graduate education.
