Where’s Most of the Money in Higher Education?

The vast disparity in wealth in the United States applies to more than individuals and their private fortunes.

It’s also true of American higher education. It turns out that one-third of all the money in American higher education is controlled by just 10 colleges. That’s it. According to this CNN piece:

The wealth gap between the nation’s 40 richest colleges and universities and the rest is getting wider.

That’s thanks to strong investment returns and a tremendous fundraising advantage, according to credit rating agency Moodys.

CoinStack

And we’re talking about a really strong fundraising advantage, here.

The richest schools had average investment returns of 50% between 2009 and 2014. The top 40 also collected 59% of all donations made to the 500 schools during fiscal year 2014.

The result: About one third of the assets held by all colleges belong to the top 10 schools, and nearly two-thirds of the assets are held by the top 40 schools.

The top ten schools, in terms of assets:

  1. Harvard University — $42.8 billion
  2. University of Texas system — $36.7 B
  3. Stanford University — $31.6B
  4. University of California system — $28.6
  5. Yale University — $25.4B
  6. Princeton University — $21.3B
  7. Massachusetts Institute of Technology — $15.2B
  8. University of Pennsylvania — $11.9B
  9. University of Michigan — $11.5B
  10. Duke University — $11.4B

It’s worth pointing out that there’s significant disparity even within this list. The University of Texas might count as one institution in terms of assets, but it’s really a gigantic network of different colleges, and enrolls 140,000 undergraduates. Harvard University, which is $6 billion richer, has only 6,700 undergraduate students.

Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer