A Comparative Analysis of Public and Private Universities in the United States Using Data Envelopment Analysis Models

Abstract

The economic crisis has its roots in the financial services industry, but it certainly impacted the higher education in a way that has far-reaching implications for the colleges and universities in the United States. With unemployment rates of 8% and above, it made it difficult for families to send their kids to colleges and as a result colleges faced decline in enrollments and pressure to cut costs. Discount rates at almost all universities with an average size of 8,000 or less went up significantly. Academic departments at various universities came under pressure to get leaner and perform better with fewer resources. In this study, we benchmark the financial performance of public universities and private universities against each other as well as against themselves over the years by using data envelopment analysis model. The study also compares universities, public and private, with less than 3,000 students and more than 3,000 students against each other as well as over a period of time. The study is important as it will help university policy makers identify their strengths and weaknesses so that they can capitalize on their strong academic programs and make changes to fix weaker academic programs.

Citation

Malhotra, R., Malhotra, D.K. and Nydick, R. (2020), "A Comparative Analysis of Public and Private Universities in the United States Using Data Envelopment Analysis Models", Lawrence, K.D. and Pai, D.R. (Ed.) Applications of Management Science (Applications of Management Science, Vol. 20), Emerald Publishing Limited, Leeds, pp. 143-156. https://doi.org/10.1108/S0276-897620200000020010