The (Un)Productivity of American Higher Education: From “Cost Disease” to Cost-Effectiveness


Publication Date: December 2010

Publisher: Wisconsin Center for the Advancement of Postsecondary Education (WISCAPE), University of Wisconsin-Madison


Research Area: Education

Keywords: Accountability, Autonomy, and Politics ; Finance and Economics

Type: Report

Coverage: United States


Productivity in academic degrees granted by American colleges and universities is declining. While there is some evidence this is caused by an uncontrollable “cost disease,” this study examines two additional explanations. First, few popular programs and strategies in higher education are cost effective, and those that are may be underutilized. Second, a lack of rigorous evidence about both the costs and effects of higher education practices intersects with a lack of incentive to use cost-effectiveness as a way to guide decision-making. Rather than simply a “cost disease,” the authors argue that the problem is more a “system disease”—one that is partly curable.