Education Commons^™

Do Indirect Cost Rates Matter?, Ronald G. Ehrenberg, Jaroslava K. Mykula

Ronald G. Ehrenberg

This study addresses the relationship between a university's indirect cost rate and its level of federal research funding. Both direct and indirect cost funding are examined. The data used in the analyses include unpublished institutional level data for all doctoral and research universities on funding and indirect cost rates obtained from the National Science Foundation for the fiscal years 1988 to 1997 period. Our major finding is that higher indirect cost rates are associated with higher levels of direct and indirect cost funding for institutions that initially are among the largest recipients of federal funding. In contrast, for universities initially …