THE RELATIONSHIP BETWEEN FUNDING AND STUDENT OUTCOMES AT PUBLIC, TWO-YEAR MINORITY SERVING INSTITUTIONS - Research paper overview

Oct 15, 2026

Uploaded by Fahsai

Historically, community colleges (public two-year institutions) enroll a larger share of undergraduates, serve a more diverse student population, and operate with lower average funding than four-year institutions. The research highlights inequities in per-pupil MSI funding and examines how disparities in public funding access may affect persistence and completion. Using IPEDS data from 2014 to 2020, the study estimates causal effects of MSI-targeted grants on college spending and student outcomes at HSIs and PBIs.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages23

Reading Time58 min

AccessFree to download

Overview

Context: community colleges and funding inequities

Research gap and questions

Literature review: spending, completion, and causal evidence

Theoretical framework: supply-side perspective

THE RELATIONSHIP BETWEEN FUNDING AND STUDENT OUTCOMES AT PUBLIC, TWO-YEAR MINORITY SERVING INSTITUTIONS July 2025 ADELA SOLIZ BENJAMIN RUBIN The Relationship Between Funding and Student Outcomes at Public, Two-Year Minority Serving Institutions Though they have experienced recent enrollment declines, historically, community colleges (i.e. public two-year colleges) have served a larger portion of undergraduates than any other institution type. They also serve a more diverse group of students than other institution types and do this with less funding, on average, than four-year institutions. Community colleges may also rely on the state for a larger portion of their funding than institutions in other sectors. Among public two-year colleges, 188 are classified as Hispanic-Serving Institutions (HSIs), 11 are Historically Black Colleges (HBCs), and 34 are Predominantly Black Institutions (PBIs) (Nguyen et al., 2023) . Recent research suggests that inequities may also exist within sectors across institutions, with Minority Serving Institutions (MSIs) receiving less funding perpupil, on average, than institutions that primarily serve white students (PWIs) (Knott, 2023) . Inequities in access to public funding are particularly problematic if changes in institution-level funding affect student persistence and completion. Though a growing body of literature estimates the causal effect of changes in institutional funding on student outcomes (Bound & Turner, 2007; Deming & Walters, 2017), not all studies include community colleges and, to our knowledge, no study explicitly explores the relationship between funding, spending and student outcomes at public two-year MSIs. Our paper starts to fill this gap in the literature. Making use of data from the Integrated Postsecondary Education Data System (IPEDS) from 2014 to 2020, we estimate the causal effect of MSI-targeted grantson college spending and student outcomes at HSIs and PBIs. Specifically, we will answer the following research questions: How does receiving MSI-targeted funding affect college spending and student outcomes at public two-year MSIs? How does this vary by community college subgroup (HSI or PBI)? Literature Review Public funding for higher education varies across states and institution types. In fiscal year 2022, state and local governments gave approximately $121 billion to higher education, or $10,237 per FTE (Kunkle & Laderman, 2022) . However, appropriations per FTE range widely across states, from $3,699 in New Hampshire to $22,970 in Illinois (Kunkle & Laderman, 2022) . Funding also varies by institution type: states gave $8,191 in appropriations per FTE to public four-year colleges and $6,297 in appropriations per FTE to public two-year colleges (Kunkle & Laderman, 2022) . Minority-serving institutions may face unique challenges in obtaining equitable funding from public sources. In 2023, the Departments of Education and Agriculture sent letters to states that have historically underfunded HBCUs (Knott, 2023) . Other research has also found that MSIs are systematically underfunded compared to peer institutions (Cunningham et al., 2014; Vargas, 2018; Williams & Davis, 2019; Partridge, 2023) . Inequitable funding patterns are particularly problematic given the link between public funding for higher education and student outcomes demonstrated in the literature. A handful of descriptive studies have explored the relationship between institutional spending and credential completion at community colleges. Calcagno et al. (2008) and Clotfelter et al. (2013) find that college spending, for example, on instruction or student services, is not correlated with degree completion or credit accumulation at public two-year colleges. Ishitani and Kamer (2020) build on this work by using Carnegie classifications to separate the colleges in their sample into three categories: high transfer, high career and technical, and mixed transfer and career and technical.

FAQs

Why are funding inequities a concern for public two-year minority serving institutions?

Because changes in institution-level public funding can affect student persistence and completion, and evidence suggests MSIs receive less funding per pupil on average than institutions primarily serving white students.

What data and period does the study use to estimate funding effects?

The study uses IPEDS data from 2014 to 2020 to estimate causal effects of MSI-targeted grants on spending and student outcomes.

How does the study analyze differences between subgroups within public two-year institutions?

It examines how receiving MSI-targeted funding affects outcomes and how those effects vary by community college subgroup, specifically HSIs versus PBIs.

Oct 15, 2026

Uploaded by Fahsai