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Cost Efficiencies And Rankings Of Flagship Universities, G. Thomas Sav

Economics Faculty Publications

Problem Statement:

Each state in the U.S. touts a premier university as the flagship of its publicly funded higher education system. With decreased government budgets and increased interest in public management reforms, these institutions are being pressured to provide evidence of and set examples for ever greater improvements in operating cost efficiencies. The problem, however, is that empirical measures of their efficiencies or inefficiencies can be sensitive and, therefore, vary widely depending upon the underlying model specification.

Approach:

The study used stochastic frontier analysis to estimate university cost inefficiencies over the 2005-09 academic years. Transom and Cobb-Douglas specifications were combined …