Differential Grading Standards and University Funding: Evidence from Italy

Transcription

1 and Funding: Evidence from Italy Manuel Bagues Mauro Sylos Labini Natalia Zinovyeva Carlos III IMT Lucca FEDEA

2 I Motivation How should public university contracts be determined? Funding based on the number of graduates or the number of exams passsed by students Potential problems: Differences in the quality of the output Differences in the quality of the input Universities may react strategically

3 I In many European countries some part of university public funding is related to the number of students (input) and/or graduates (output) Countries Funding Admission Quality Assessment Effect on Funding Flanders (Belgium) Input open no France Input open no Germany Input open no Portugal Input binding numerus clausus no UK Input selective yes Denmark Output binding numerus clausus no Italy Mixed open no Netherlands Mixed open no Spain Mixed open no Sweden Mixed selective no

4 I Motivation How should public university contracts be determined? Funding based on the number of graduates or the number of exams passsed by students Potential problems: Differences in the quality of the output Differences in the quality of the input Universities may react strategically

5 I Motivation How should public university contracts be determined? Funding based on the number of graduates or the number of exams passsed by students Potential problems: Differences in the quality of the output Differences in the quality of the input Universities may react strategically

6 I Motivation How should public university contracts be determined? Funding based on the number of graduates or the number of exams passsed by students Potential problems: Differences in the quality of the output Differences in the quality of the input Universities may react strategically

7 I Motivation How should public university contracts be determined? Funding based on the number of graduates or the number of exams passsed by students Potential problems: Differences in the quality of the output Differences in the quality of the input Universities may react strategically

8 I In this paper: We show that in Italy there exist differential grading standards across disciplines and universities. We discuss the implications of the existence of differential grading standards for university financing.

9 I Background literature In the US: Grade inflation perceived deterioration in the educational standards (Kilevzon, 1981; Sabot and Wakeman-Linn, 1991) Grade divergence divergence of grading standards across different disciplines (Sabot and Wakeman-Linn, 1991; Freeman, 1999) Freeman (1999) analyzes a sample of graduates from 648 US colleges Graduates from high-grading disciplines have lower earnings Institutional constraints prevent, within each university, a flexible money pricing for courses with different expected earnings

10 I Background literature In Europe: Germany: average grades vary widely across universities (German Science and Humanities Council, 2004) Italy: Grades tend to vary significantly across disciplines and regions (Boero et al., 2001) It is not well understood, however, whether these differences in grades across institutions stem from quality differences or rather from differential grading standards

11 I Data Survey on -to-work Transition run in 1998, 2001, and 2004 on individuals graduated in 1995, 1998, and 2001 respectively The target samples represent respectively the 25%, 28.1%, and 24.7% of the total graduates Response rates 64.7%, 53.3%, and 67.6% Total number of respondents 17326, and Universities Indicators (e.g. number of students, professors, funding...)

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15 I The determinants of grades - Individual characteristics - Dummy variables for year of graduation - Dummy variables for field of study (discipline) - Dummy variables for university

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19 I Differences in quality or differences in grading standards? Two proxies of quality: Graduates labor market performance The outcomes of external professional qualification exams Required for a number of professional occupations Mainly graduates in chemistry and engineering

20 I 1. -Dummy variables for department d in year t Individual grade Department effect on grade Individual relative grade 2.

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23 I Should we worry about differential grading standards? Public Funding Funding system based partially on the number of exams passed by students (FTE students), introduced in 1995 Which universities are favored? Favours those universities with lower grading standards However, this indicator does not take into account the initial quality of students, favouring universities where the quality of new students is relatively better.

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25 I Summary of results Differential grading standards Average grades vary both across disciplines and across universities Graduates from high-grading degrees perform significantly worse in the labor market and in professional qualification exams. This suggests that there exist differential grading standards across departments The university funding mechanism based on the number of exams passed by students favors universities that generate lower value added

26 I Discussion and further research Hypotheses: Incentives generated by funding system The negative relationship between grades and labor market performance has increased over time Relative (instead of absolute) evaluation of student performance coupled with very heterogeneous population of students in different schools Evidence from OECD PISA standardized exams

27 I Thank you for your attention!

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29 I OECD PISA 2003 mathematics scores and university grades 5 4 Average PISA math score Department effect on university grades

30 I Variation FFO Bergamo Teramo Napoli-Nav Brescia Lecce Chieti-Pescara Milano-Poli Salerno Verona Cassino Macerata Cosenza Bari-Poli AnconaNapoli Campobasso II Parma Bologna Bari Cagliari Catania Ferrara Modena-RE Venezia-Arc Roma-TV Trento Torino-Poli Udine Padova Sassari Viterbo Palermo Camerino Potenza L'Aquila Torino Roma-Sap Perugia Milano Venezia Trieste Messina Firenze Siena Napoli-FedII Genova Pisa Pavia R. Calabria Napoli Teaching quality