Panel Paper: The Supply-Side Response to Increased Demand for Higher Education: Case Study Evidence from Four Michigan Community Colleges

Friday, November 3, 2017
Columbian (Hyatt Regency Chicago)

*Names in bold indicate Presenter

Kevin Stange, John Bound and Jeffrey Smith, University of Michigan


Many colleges experienced a large increase in enrollment during the Great Recession, which could create supply constraints as funding does not typically expand proportionately. Using administrative data we conduct a focused study of four community colleges in Michigan during this recent demand surge. We find that the largest increases in enrollment was in basic, remedial, and general academic subjects, lower-level courses, and courses typically taken by less-prepared students. More costly courses saw less growth. Observed student characteristics cannot account for these changes in course-taking. Interestingly, the colleges were largely able to absorb this large enrollment increase by adding additional sections taught by adjunct (non-permanent) faculty with minimal impact on class size, crowding, or the time when courses are offered. Despite achieving slightly lower grades and having lower course credit completion rates, students entering college with large cohorts are more likely to transfer. The overarching conclusion is that community colleges are quite elastic and appear to have the ability to expand to meet surges in demand.