Factors that are most important to institutional effectiveness in the production of black baccalaureates were studied. A further concern was how these factors can be translated into policies and practices for undergraduate institutions that have not traditionally served black students. An effectiveness quotient was developed as an overall measure of institutional effectiveness. The quotient was a function of total black enrollment and total black graduates in all institutions. An input-output model was also used in the analysis. The first stage of data collection consisted of 1972-1981 enrollments by race, total earned degrees by race, and Scholastic Aptitude Test scores by race. An effectiveness quotient score was calculated for each year, based on comparisons by racial groups as to the effectiveness of the institutions in the production of baccalaureates. Next, detailed institutional data were collected from 84 traditionally white institutions and 18 traditionally black institutions. Finally, a research review was conducted of 31 studies that examined persistence among black undergraduates and/or institutional effectiveness among the colleges. In addition to analysis of the findings, policy implications are considered. A literature review is included. (SW)