The relative incidence of across-the-board cuts in higher education for all institutions that experienced decreasing revenues between 1976-1977 and 1980-1981 was studied. Factors that affect the extent to which administrators employed across-the-board cuts versus selective cuts were also assessed. Attention was focused on the effects of the severity of revenue decline, the duration of the decline episode, the institution's recent history in managing decline, institutional control, and the effect of the type of institution on the reallocation of institutional resources. Data were obtained from the Higher Education General Information Survey finance and enrollments questionnaires. Reallocation was defined as the percentage of constant dollar expenditures across functional areas in time that differed from what would be expected in an across-the-board cutback. It was found that the majority of the cuts tended toward minimal reallocation. The results supported the hypothesis that reallocation: increases as the severity of decline increases, decreases as the length of a decline episode increases, is more likely in private institutions, and is more likely in two-year institutions. Additional findings and implications are discussed. Types of expenditures for 10 functional areas are also outlined. (SW)