Cost Accounting at a Research University
Seminar at the Center for Studies in Higher Education, UC Berkeley
by Charles Schwartz
ABSTRACT
A longstanding business practice at universities and colleges hides the cost of faculty research under the accounting category of “Instruction.” This is especially misleading for research universities in their communications with students, legislators and the general public about financial matters. A proper cost analysis for the University of California shows that undergraduate student fees here are now at 100% of what the institution actually spends, averaged per-student, for that mission. This result contradicts the official claim that student fees cover only 30% of the cost of their education. Estimates of this discrepancy are also provided for some other research universities, both public and private. This has broad implications for public policy regarding higher education.
For the full text go to http://socrates.berkeley.edu/~schwrtz/Approp.pdf