The Unintended Consequences of Performance-Based Funding

Performance-based funding, which ties a portion of a college’s state support to outcomes like graduation rates and degree production, remains one of the most widely used accountability drivers in higher education. In recent years, however, researchers have found that it can have unintended consequences for underrepresented student groups.

One of those researchers, Seton Hall University’s Robert Kelchen, led a national study of colleges and universities to understand the impact of performance-based funding, and whether targeted bonuses can boost enrollment rates for minorities and low-income students. He joins CPRE research specialist Robert Nathenson to discuss his findings and their potential implications for higher education policy across the U.S.