The Bulletin: College debt effects alumni giving

Here at 28&J, We want to promote discussion and dialogue to find solutions to the problems that exist at TSU. When you see “The Bulletin” that means we want you to respond to us. The Bulletin is a reference to one of the first publications used to dispense information to faculty and students at our alma mater in the 1920s.

Below is a study done about college giving. It has commonly reported that only 3% of our alumni give back. In reading it,  think about “What we can do as alumni to improve our alumni giving?”

Determinants of alumni giving rates. 

Terry, Neil
Macy, Anne

2007

ABSTRACT

This manuscript examines the determinants of alumni giving rates. The data set is derived from U.S. News & World Report and comprises 196 educational institutions. The combination of decreased state funding for education and increasing costs of education has increased the need to find alternative sources of funds. Alumni donations provide the funds needed along with the signal that alumni are proud of their alma mater. Regression results indicate that the primary determinants of alumni giving rates are institutional acceptance rate, amount of average student debt, percent of students receiving Pell Grants, cost of room and board, value of the institution’s endowment, public versus private institutions, percent of full-time students, and percent of female students.

Tennessee State University information from the article.

Descriptive statistics for the model variables are presented in Table 1. Princeton University has the highest alumni giving rate at sixty-one percent, while Nova Southeastern University and Tennessee State University have the lowest alumni giving rate at three percent.

Conclusions

One of the more interesting results is the negative and statistically significant impact associated with average student debt. Government decisions that students should bear more of the cost of higher education resulting in rising debt levels appears to have a negative impact on alumni giving. Rising student debt might also diminish the sense of obligation to support an educational institution after graduation. Budgetary issues in the form of need and costs have a negative impact on alumni giving rates. A larger percentage of students receiving core financial support via Pell Grants and relatively high room and board costs have a negative and significant impact on alumni giving rates. These alumni may not have the resources to give or give to family members instead.

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