Thanks to economics professor Larry Singell, next time an Oregon taxpayer asks why he or she should support higher education, the University will be able to respond with hard data.
Singell’s report analyzes the economic impact of the University on the state of Oregon. Its primary finding is that for every dollar the school received from the legislature in 2004 and 2005, it pumped $20 back into the state’s economy.
“What the document is trying to say is, ‘Look, there is an economic rationale for providing state support for higher education,’” Singell said. “It shows that by and large, a dollar invested in the U of O is a good investment in turn for the state.”
At a time when state funding for Oregon public universities is consistently declining, educators are looking for new and innovative ways to push for more support.
“What we are good at in the University is providing arguments – and economists are particularly good,” said Singell. “I think that people in the legislature are more likely to listen to those types of arguments than ones that are based on motives.”
The argument should make legislators happy. The report, aptly titled “A Study of the Economic Impact of the University of Oregon,” shows that the University is one of the top revenue-generating private enterprises in Oregon, with more than $454 million in the 2004-05 academic year. It draws most of its revenue from out-of-state sources, such as students, federal grants and research funding.
“(The University’s) ability to generate revenue from out-of-state sources yields expenditures on goods and services provided to, but not funded by, Oregonians,” according to the report. Thus, the state of Oregon benefits financially from the University’s expenditures.
But Singell said the University contributes to the state both economically and socially. He said there are some immeasurable benefits to Oregonians, such as educated and capable citizens, better-informed voters and people willing to participate in their communities.
“Many of the contributions of higher education are in the value of a liberal arts education and those don’t exactly have economic measures, but are genuine and real,” Singell said. “This document is only part of the story. This report is not meant to be capturing all of the potential benefits that the institution has; that is not a realistic goal.”
This is not Singell’s first economic report for the University. He did a similar one a few years ago, and might be doing another next year. He said the intent is to do these analyses on a regular basis, and he is trying to set up the technology for the institution’s future needs.
The University commissioned this report in 2006 and provided financial, employment and student data to Singell, who then proceeded to use “standard economic techniques” to evaluate the school’s economic impact.
Ultimately, the report tries to assert that Oregon tax payers would benefit from more investment in higher education. Singell said these reports are healthy exercises that show higher education is an investment that has a real payoff.
“Public institutions need to justify expenditures,” said Singell. “They need to explain why people in the state should support these institutions. This is a good thing on the part of the institution to actually provide these answers.”
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the findings
For every dollar the state invests in the University, the University contributes $20 back to Oregon’s economy.
The school derives most of its revenues from out-of-state sources and spends the majority of those revenues in-state, making it one of the top revenue-generating private enterprises in Oregon.
The University generated more than $454 million in revenues in the 2004-05 academic year.
The institution contributes to Oregon’s evolving infrastructure by averaging $30 million in annual construction projects over the past five years.