This paper analyzes how James Tobin's widely cited concept of "intergenerational equity" for university endowments relates to the economic concepts of intertemporal substitutability and risk aversion. I show that Tobin's concept of intergenerational equity is a very special case of intertemporal substitutability; a special case that implies very low tolerance for risk. Using the more general case, I show that the observed reduction in university spending rates during the 1990s can be viewed as a reasonable response to a period of non-recurring capital gains.