<p>This maybe a silly question to ask, but where do endowments typcally come from? Is there a place where I can find out info about particular university endowments? Thank you very much for any input.</p>
<p>If you subscribe to the "Chronicle of Higher Education," you can find college endowments listed for about 750 schools.</p>
<p>you dont even need to subscribe - <a href="http://chronicle.com/premium/stats/endowments/endowment_results.php3?Year=2006&Order=1&State_Type=All_states&limit=%5B/url%5D">http://chronicle.com/premium/stats/endowments/endowment_results.php3?Year=2006&Order=1&State_Type=All_states&limit=</a></p>
<p>Jags86, you need a password to access it with the URL that you provided.</p>
<p>Page 3 of the following PDF file has a chart of "per student endowments" for selected hoity-toit colleges and universities:</p>
<p>The "per student" calculation includes graduate and professional school students as appropriate for each university. The liberal arts colleges generally include only undergrads in the calculation, since there are no graduate students. As a general rule of thumb, universities spend double for each grad student than they do for each undergrad, an even higher ratio for professional school students (such as med school, etc). So, if you really felt like it, you could probably work backwards from the enrollment figures to get at least a rough guess as to the percentage of endowment that is applicable to undergrads.</p>
<p>This PDF gives the total endowment size for every college and university as of June 2004, without any calculation for the number of students supported by that endowment:</p>
<p>The original question seemed to be "where to endowments come from?" rather than "how much are the endowments?" at various colleges and universities. I think the answer to the question of "where to endowments come from?" is twofold:
1) The endowments start with gifts. Primarily these gifts come from alumni. Some are bequests, etc.
2) The earnings on the endowment, which depends on how well or poorly the college manages the endowment fund.</p>
<p>This gives an advantage to schools that have a long history of graduates who have the ability and inclination to donate $ to their alma mater, and who have managed/invested their endowments well over a long period of time.</p>
<p>thanks guys for all the knowledgeable input! I am interested to know exactly where college endowments are derived from. I know the "chronicle" lists endowments, but I am not a subscriber (thanks taxguy). would they list the derivation as well? For example, Harvard gets a huge endowment. Do they get all their funding from alumni dadx3? Where do schools acquire the funding to award scholarships/grants or any other forms of aid to students or faculty research? I would assume that some of that money come from governement agencies, but I am not sure. Thanks</p>
<p>Endowments are like savings accounts for colleges. Over the years, donors give money to the endowment fund. That money is invested (mostly in the stock market) and the size of the endowment grows. Colleges spend about 4 to 5% of the endowment each year, which (theoretically) is less that the endowment investments are earning, so the endowment continues to grow.</p>
<p>Most of the colleges with large endowments had significant endowments 100 years ago and benefitted from huge stock market returns. Occassionally, a "new" college pops up on the radar screen due to an individual donor. For example, the founder of Coca-Cola, Robert Woodruff, gave larges gifts of Coca-Cola stock in the early days to Emory University. When the stock price took off, Emory was left with a huge endowment.</p>
<p>I don't believe government grants ever go directly into college endowments. Government grants and expenditures can go to pay for research, to build research facilities that are needed to perform government research work, and to provide direct scholarship aid. The "Land Grant" universities did get an endowment of sorts, but I don't think it was a direct cash transfer into an endowment. Various states dedicate revenue from timber or oil to fund the state university system. Sometimes these funds pay ongoing expenses and sometimes they are dedicated to construction of facilities.</p>
<p>College endowments are also often used to provide for scholarships, among other things. Sometimes there are specific scholarships that are endowed by a particular (private) donor based on his or her donation. Other uses of specific endowment gifts are to fund "named" professorships (e.g. The John and Jane Smith Professor of Biology), build buildings and any number of other uses.</p>
<p>Why are you interested in where endowments come from? Every college or university I know of has a "Development" office which is given the task of raising money both for current spending projects and increasing the endowment. The unless you are interested in working in college development, the main impact of college endowments is their size and how they are used by the college, not where they came from.</p>
<p>Endowment is generally speaking a good thing, but it depends on how it is spent. Berea, for example, uses its huge endowment to make the school tuition free for all attendees. Their graduates are extraordinarily generous.</p>
<p>Like other great fortunes, the huge endowments of some schools have been achieved through successful investments of funds garnered many decades earlier. University endowments can make some suprisingly aggressive investments with a portion of their funds, and sometimes these pay off very well.</p>
<p>Recent article in the Amherst Student stated that they have just gone over the one billion amount. This was attributable to "return on ivestments, additional gifts, as well as the spending of the endowment." gifts and donations, and the fact that they earned 19.3% on their investments, whereas they cited that schools with smaller endowments made much less percentage-wise, the average being 9.75 percent. Harvard has the highest endowment at 25.5 billion, then Yale at 15.2 billion. It also said that the spending rate of the endowment to meet the school's budget has declined nationwide from 4.8 to 4.6 percent.</p>
<p>Mini:</p>
<p>Yes, endowment spending, student pricing, and expenditures are a useful way of comparing colleges. For example, Wellesley and Berea have very similar per student endowment figures, but vastly different pricing structures and, therefore, vastly different levels of spending:</p>
<p>Per student endowment:</p>
<p>Berea: 525,074
Wellesley: 542,274</p>
<p>Per student endowment spending:</p>
<p>Berea: 21,983
Wellesley: 27,408</p>
<p>Per student revenue (tuition, room, board, fees):</p>
<p>Berea: 4,285
Wellesley: 27,352</p>
<p>Per student expenditures:</p>
<p>Berea: 37,101
Wellesley: 71,738</p>
<p>The two schools clearly have very different philosophies. What they share in common is very large per student endowments providing enormous subsidies for each and every student. Both offer tremendous value based entirely on the spending from endowment.</p>
<p>But endowment just isn't all that it is cracked up to be. Swarthmore (or Smith) are not "five times better" than Occidental, despite 5x the endowment. (In certain areas, Occidental is better than either of them.) Independent of endowment income, there are quite a few schools that make up for smaller endowments through outsized corporate contributions which make it possible to make huge new investments in facilities and programming with what might otherwise be seen very small endowments (University of Denver is a prime case in point.)</p>
<p>Per student spending doesn't tell you ANYTHING in the Wellesley/Berea comparison - All Berea students are required to work on campus - including maintainence, lab set-up, buildings and grounds, a/v presentation for faculty lectures, etc., obviating the need the lots of those campus expenditures to begin with, while providing enhanced learning experiences for students. So you could argue (knowing something about Berea, I would) that LOWER per student spending results in enhanced learning, greater community, and (perhaps) greater student responsibility. (you've seen what is happening at our common alma mater these days.) Williams per student expenditures include a PGA golf course; nice of course (except, often, even students who like to golf can't even get on.)</p>
<p>I haven't seen much talk about Berry College on cc these days. ;)</p>
<p>
[quote]
But endowment just isn't all that it is cracked up to be. Swarthmore (or Smith) are not "five times better" than Occidental, despite 5x the endowment. (In certain areas, Occidental is better than either of them.)
[/quote]
</p>
<p>Smith and Swarthmore don't cost 5 times more than Occidental.</p>
<p>Here are the average costs per student for tuition, room, board, and fees (after financial aid) for the three schools in 2003-04:</p>
<p>Occidental: $21,294
Swarthmore: $26,585
Smith: $27,490</p>
<p>So, the real question is not whether Smith or Swarthmore are five times "better", but rather are they worth $5,000 or $6,000 more per year over Occidental?</p>
<p>One simplistic way of approaching that question is to look at per student expenditures, i.e. purely from a dollars and cents standpoint, what is the average student getting for their money? What is the bang for the buck?</p>
<p>Occidental: $34,488
Smith: $57,567
Swarthmore: $68,304</p>
<p>For an extra $5,000 or $6,000 per year, the average student is getting $23,000 or $34,000 more in "goods and services". Thus, in dollars and cents terms, it is not difficult to understand why Smith and Swarthmore have longer lines of customers waiting at their doors and, therefore, higher selectivity.</p>
<p>Now, you could argue that the extras Smith and Swarthmore spend money on are meaningless for a particular student and that may be true in some cases. However, on a macro level, many of those extras (more faculty per student, nicer campus, more generous leave to keep professors fresh, etc.) do have value.</p>
<p>I think Mini is right. Just throwing more numbers out isn't all that convincing. Just because more money is spent, doesn't mean that things are automatically better or superior. What value is there to extras if they're not used directly for education. Does a better landscaped campus provide a better education to its students? Does a smaller class necessarily mean a better teacher or a better learning environment? Does more faculty per student necessarily make the teaching better? No, it just means there are more faculty per student. I've sat in on small classes at school's I've visited, and some of those professors were awful, while the teaching in some larger classes I visited at larger places with fewer faculty per student were far better.</p>
<p>You could probably argue that wealthier schools could spend more money on making themselves look more attractive through slick marketing brochures, fancy campuses, and well-informed public relations people that work very hard to make the school attractive in marketing materials, brochures, school websites, online discussion forums, etc.</p>
<p>"For an extra $5,000 or $6,000 per year, the average student is getting $23,000 or $34,000 more in "goods and services". Thus, in dollars and cents terms, it is not difficult to understand why Smith and Swarthmore have longer lines of customers waiting at their doors and, therefore, higher selectivity."</p>
<p>As already noted with the extreme case of Berea (and a lesser case could be made for Occidental with its community service learning programs), it is not clear that they are getting ANYTHING more in the way of goods and services. In the case of Swarthmore, they are getting a school orchestra so small they have difficulty performing the larger romantic works (that is specifically a result of lower per-student spending, because they are spreading the orchestra costs over a smaller number of students), in the case of Smith a film department that is really stretched thin (and one sabbatical can put them into a tizzy), and I can probably find similar all over the place. </p>
<p>I'm not at all arguing that schools - any schools - spend money on meaningless extras. Meaningless is in the mind of the one ascribing the meaning. All I'm suggesting is that the both spending per student and endowment per student are not clear indications of "quality" (whatever that means - I don't see Berry College any top 20 lists lately), that in some cases (Berea being one) a good argument can be made that the contrary is in fact the case, and that in any case, there are substantial laws of diminishing return.</p>
<p>
[quote]
As already noted with the extreme case of Berea (and a lesser case could be made for Occidental with its community service learning programs), it is not clear that they are getting ANYTHING more in the way of goods and services. In the case of Swarthmore, they are getting a school orchestra so small they have difficulty performing the larger romantic works (that is specifically a result of lower per-student spending, because they are spreading the orchestra costs over a smaller number of students), in the case of Smith a film department that is really stretched thin (and one sabbatical can put them into a tizzy), and I can probably find similar all over the place.
[/quote]
</p>
<p>But, wait. Berea doesn't have an orchestra and offers one film course, taught in alternating years. So, how is the lower per student spending better for film or orchestra students?</p>
<p>You can go through and pick out specific programs that a given college emphasizes or not...and I would encourage individual applicants to do that for specific schools. However, that misses the point of an "macro-level" view of per student revenue, per student endowment, per student expenditures, etc. Leather seats, a power moonroof, ABS braking, or a DOHC engine may or may not be important features to a given buyer, but they are value-added features, nevertheless.</p>
<hr>
<p>You talk about Berry College so much that I have to ask a question. Have you ever been to Rome, GA? BTW, they don't have an Orchestra, either. However, I suppose that Berry students could audition for the 38-member Rome Symphony Orchestra. Is that large enough to perform "larger romantic works"?</p>