ERIC Number: ED136694
Record Type: RIE
Publication Date: 1973-May-17
Reference Count: 0
Why Analyze Costs? How Analyze Costs?
Witmer, David R.
Institutional costs need to be analyzed for several reasons: (1) to increase the income of the institution; (2) to improve decision-making at the margin; and (3) to maximize efficiency. The means of costs analysis involve a simple issue: which costs to include. This decision depends on the purpose of the analysis. The actual effects of the usual variations in costs analysis methodologies on results is slight; the acceptability of results, however, is greatly enhanced by the use of standard methods. A student of investment theory would conclude that higher education investment policies (that is, the regularly recurring decisions that result in costs) have not been rational; he would probably suggest that higher education covary costs with benefits in accordance with the results of cost studies. Doing so brings higher education face to face with the pricing issue, and the differences and similarities between this and other industries. Some careful reflection on tomorrow's policy issues may help in developing better methodologies today. (Author/MSE)
Publication Type: Speeches/Meeting Papers
Education Level: N/A
Authoring Institution: N/A
Note: Paper presented at the Annual Forum of the Association of Institutional Research (Vancouver, B.C., May 1973). Not available in hard copy due to marginal legibility of original document.