Emory University’s position as a leading private university in the south has been cushioned by a massive endowment which schools of equal or greater ranking are nowhere close to. The history behind it all is well known to most Emory students and staff, and possibly to most Atlanta natives, as we are frequently referred to as ‘Coke University.’ After being kicked out of Emory, Robert Woodruff years later decided to give Emory a huge donation that they took gleefully. And after years of investing, and years of Coca-Cola success, Emory sits pretty with over 6 billion dollars in their endowment. Where does all this 6 billion go to? Well sadly (I think), only a small percentage of this endowment will directly benefit us as students and faculty on campus.
After doing some research on ‘The Emory Endowment’, the most important facets of Emory became obvious. Under the ‘Why Support Emory’ tab, the three main heading which came up were: Scholarships, Research, and Faculty. Donors have the opportunity to see the cutting edge technology and engagement that we as a community are striving for, through well designed features and news about our AIDS research, our highly sought after study abroad trips, and the millions of dollars spent each year on loans, grants and scholarships. By the looks of this website, one would think that Emory’s main goal is to develop a holistic sense of success on our campus; so that outsiders will become more enamored and give their money, but also that alumni would reflect and see what great heights Emory students and faculty are reaching.
According to the NYT “Some Colleges Have More Students From the Top 1 PercentThan the Bottom 60. Find Yours.”, Emory is #2 among Elite Colleges to enroll the highest percentage of middle to low income students. That’s great, because it means that Emory has a lot of money dedicated to the Scholarship umbrella of its operational budget, (or students are more in debt after leaving college). However, what’s interesting to note is that Emory is nowhere near close to managing its ‘diverse’ acceptance list as there is a major gap in where these alumni are now. About 1.8% of students at Emory came from a poor family but became a rich adult.
How does a 6.7 billion dollar endowment fix that staggering statistic? Although as an institution we brag about the great things that Emory students and alum have accomplished, there is an elephant in the room when it comes to where these students end up 4 years after leaving the Emory bubble. Our (Emory’s) pockets are padded well, but the hands that distribute and control are a bit lopsided.
This makes me question what Emory’s gauge of success is. Is their priority to see how best to keep the news and attention within the university itself, or is it to properly equip over 1000 students each year to go out and dominate in which ever field they pursue?
Using Tableau, we were able to capture the trends of endowments, mobility rates, and the type of school all within one graph. In this section of the project, we are focusing on major public and private schools that are nationally ranked as top tier schools:
- UC Berkeley
- University of Virginia
- University of Michigan
- UNC Chapel Hill
- College of William and Mary
- Georgia Institute of Technology
- Texas A&M
- University of Florida
- University of Texas System
- Ohio State
- University of Wisconsin- Madison
- University of Chicago
- University of Pennsylvania
- Johns Hopkins
Shiven did a great job incorporating all of the factors we decided to focus on. The green circles represent private colleges while the blue circles represent public colleges. The mobility rate involves the students in the bottom 20% moving to the top 20%. There one major trend occurring. The private schools seem to be correlated with a larger endowment while public schools are associated with smaller endowments. This was a trend we predicted and did not find that surprising. Another trend we saw is that the public schools tended to have lower mobility rates than the private schools, but this trend was not as obvious or strong. Rather, the public schools had a wide range of economic mobility. The private schools on the other hand, stayed within a similar range of mobility rate, regardless of their endowments. Even though public schools tended to have a smaller endowment, when compared to private schools of similar endowments, the public schools sometimes had higher mobility rates than private schools. Again, this is not a strong correlation but it is an interesting point we found in this data. With respects to endowment vs mobility, suprisingly enough we found that in the top tier schools across the nation, those with lower endowments had higher economic mobility.
Something that took our interest immediately was the two blue outliers: UCLA and UC Berkeley. They have rather small endowments compared to the other schools in this analysis, yet their mobility rates exceeded all others, including Harvard with a whopping $32.7 billion a year. We were aware of the California public school system and that their public schools surpassed many other private schools in other states, but we would not have guessed the success of its students was greater than Ivy League schools.
This data now allows us to explore these outliers. First is Harvard, which rakes in 32.7 billion dollars each year, but only has a mobility rate of 1.8%. Second is the UC school system, specifically UCLA and UC Berkeley. Only given about 1/10th of Harvard’s endowments, their mobility rate is 5.6% and 4.9% respectively. It brings into question where these endowments are allocated. Are they given back to the students? Or are they spent elsewhere?
Public universities are primarily funded by a state government while private schools are run as an educational non-profit institution. Private universities do not receive funding from a state government but instead is primarily funded by donations and gifts.
A school’s endowment is essentially a fund that has been given to them through the government, donations, and gifts. This money is then invested and a small percentage (usually 4-5%) of the returns on investment is what a university can now use to run their day-to-day operations.
We hypothesized that a school’s endowment could be a strong indication of the quality of education the students received. However, we do realize that a school’s return on investment is not solely spent on prospective and current students, but also on other operational budgets that are necessary for a smooth running system.
It has been often stereotyped that private universities have an overall better quality education and as a group, we wanted to look at the role of endowments in this deception. Do public universities tend to have less money in their operating accounts than private universities? We chose universities which topped the ranks for highest endowment for both public and private schools and decided to compare their endowments
From the graph above, the blue bars represent public institutions while the green bars represent private institutions. As is obvious from the graph, private schools tend to have a larger endowment than most public schools, with the exception of a few schools such as University of Michigan and Texas A&M University that have a larger endowment than 50% of the ‘richest’ private institutions.
One would have made the assumption that private schools would have a larger endowment, because of prestige but we see that history also is a major contributor to sizable endowments. For example, although Emory may not be in the top ranking private schools, it still has a large endowment due to its historical connections with Robert Woodruff, past president of Coca-Cola. And also Harvard, an outlier on the graph, has a hefty endowment due to its prestige, as a top ranking school with generous alumni.
However, if we look at the income mobility of the students who attend these schools with hefty endowments, most are nowhere near the top of the list. The lapse in results poses an issue to us as a group, as we begin to question the allocation of this 4-5% return on investment to these schools. Do most schools see mobility rate as a marker of growth and excellence in their academia community? If so, would more of their operational budget be spent on improving curriculum and opportunities within the college that exposes students to better, higher paying jobs?
The Equality of Opportunity Project gathers data on economic mobility of college student. The project includes a wide range of factors, including geography, gender, parent’s income, etc. As a class, we have decided to further analyze some variables that may contribute to a college’s ability to increase income mobility of their students. In this section, we will be focusing on endowments, specifically in top tier private and public colleges. Some of the colleges include Harvard, Emory, Texas A&M, University of Florida, UCLA and UNC Chapel Hill.
Our goal is to first see if there is a correlation between endowments and income mobility with students. Afterwards, we will be comparing public and private schools of similar endowments to see if there might be an advantage to going to one type of school over the other. Additionally, there will be room for future research on how allocation of the endowments, whether it be equity fees, research, athletics, or curriculum, affects the success of the students.
There are a lot of confounding factors that can play into student income mobility, however we are interested in seeing a correlation between the money put into a school (endowment), and the success of the students from those institutions. Are colleges rightfully allocating their endowment to the betterment of current and perspective students during and after college? If not, what are the other possible areas that their endowments may be invested in.
An overarching question for this project is: How do colleges gauge success? Is it based on how well their students do after leaving college or is it based on prestige which has carried on to modern times? Can a school’s endowment be a good indicator as to how well a school is doing?