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ERIC Number: EJ778762
Record Type: Journal
Publication Date: 2003-Dec
Pages: 11
Abstractor: Author
Reference Count: 0
ISSN: ISSN-0272-7757
Endowment Spending Rates, Intergenerational Equity and the Sources of Capital Gains
Woglom, Geoffrey
Economics of Education Review, v22 n6 p591-601 Dec 2003
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.
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Publication Type: Journal Articles; Reports - Evaluative
Education Level: Higher Education; Postsecondary Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A