Data Envelopment Analysis of Relative Efficiencies of Public and Private Institutions of Higher Learning

There has been considerable public debate surrounding the efficiency of higher education in the United States. Using Data Envelopment Analysis, we look at the efficiency of a majority of the institutions of higher learning in the United States. Using two different approaches, we find some evidence that private institutions of higher learning are more efficient than public ones. In particular, masters and bachelors-granting institutions with unrestricted revenue greater than 85% are more efficient than those with less than 85%. Public institutions tend to have more restricted funding, suggesting that their stakeholders constrain them from operating on the frontier.