<p>abstract:</p><p>Each year, the U.S. Department of Education assigns all private nonprofit and for-profit colleges receiving federal financial aid dollars a financial responsibility score, which is designed to reflect an institution's overall financial stability. Yet no scholarly literature has examined financial responsibility scores or whether colleges respond to this high-stakes accountability policy. In this paper, I use data on financial responsibility scores from the 2006-07 through 2013-14 academic years to explore if colleges respond to not receiving a passing score on the financial responsibility test by changing their revenues, expenditures, or student enrollment. I find little evidence that colleges that did not pass the test changed their fiscal priorities in any meaningful way.</p>
Journal of Education Finance – University of Illinois Press
Published: Nov 10, 2018
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