Collegiate Innovation in an Unlikely Place: Ohio

By Richard Vedder

Ohio is boring. I have lived there for two-thirds of my life. People are friendly, mostly good, etc., but not on average terribly innovative, in part because a rapidly expanding state and local governmental sector has crowded out private entrepreneurship. In my lifetime, incomes have gone (on average) from well above the national average to well below.

Yet, to my surprise, a couple of promising moves have come out of the Buckeye State. First, the Ohio Board of Regents traditionally has funded universities on the basis of students enrolled. Now they are putting much more emphasis on academic success --things like retention and graduation rates. Eric Fingerhut, the Chancellor of the Board of Regents, is smart (although he has some loopy political views, in my judgment), and focused on making higher education more efficient and responsive. He is pushing for more transparency, and getting some results, although it is still too early to say much definitively.

Second, prodded by the Board of Trustees and perhaps the business office (specifically CFO Bill Decatur), my own university, Ohio University, is poised to do something innovative and exciting (a rarity for a school that usually follows the fads of academia rather than leading them). The involvement of the Trustees is particularly noteworthy because in general this is one the worst Board of Trustees I have experienced in a half century of watching American higher education. But it does have some experienced business persons of some competence.

Specifically OU is considering privatizing its housing operations. They may do so because they are facing large capital costs, and are grudgingly but courageously admitting the obvious: universities are better at doing academics than engaging in lodging operations. Specifically, the school has enormously expensive labor agreements with an union (workers probably earn on average 40-50 percent more than the going wage in the area for the types of work performed). Prevailing wage laws make renovations of buildings very costly. Private entrepreneurs can provide higher quality housing at the same prices as the university, and keep the school from adding to its already sizable debt load. I am proud of the school I have taught at for 43 plus years for considering this move.

To be sure, both the funding formula idea and the privatization of housing is going on elsewhere, but when it comes to mainstream Ohio, you know that the winds of change in higher education are picking up a bit.