Traditionally, public funding of higher education has been viewed as cyclical, where support falls during times of economic downturn and then recovers as the economy improves. This view, however, is being challenged as budgetary shortfalls are becoming more common for states, even in times of economic growth, due to structural constraints. Using economic modeling and econometric analysis, this study investigates the reasons behind this phenomenon based on demographic, economic, and political factors from 1985-2008 for 42 states. The model incorporates both short- and long-term factors in their attempt to explain the changing pattern. The empirical model shows that, in a per-capita basis, public funding for higher education exhibited a long-term decreasing trend rather than an increasing one. Further, the study shows that structural factors do impact higher education appropriations. Increases in Medicaid funding were found to have a significantly negative impact on higher education funding. After taking into account structural issues that may impact the long-term trend, the results indicate that cyclical factors still play an important role in public funding of higher education. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com/en-US/products/dissertations/individuals.shtml.]