How University Endowments Respond to Financial Market Shocks: Evidence and Implications

• 成果类型: Article
• 署名作者: Brown, Jeffrey R.; Dimmock, Stephen G.; Kang, Jun-Koo; Weisbenner, Scott J.
• 署名单位: University of Illinois System; University of Illinois Urbana-Champaign; National Bureau of Economic Research; Nanyang Technological University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.104.3.931
• 发表日期: 2014
• 页码: 931-962
• 关键词: economics

摘要

Endowment payouts have become an increasingly important component of universities' revenues in recent decades. We study how universities respond to financial shocks to endowments and thus shed light on a number of existing models of endowment behavior. Endowments actively reduce payouts relative to their stated payout policies following negative, but not positive, shocks. This asymmetric behavior is consistent with endowment hoarding,especially among endowments whose current value is close to the benchmark value at the start of the university president's tenure. We also document the effect of negative endowment shocks on university operations, such as personnel cuts.