The impact of college sports success on the quantity and quality of student applications.

• Author: Pope, Devin G.

1. Introduction

   Since the beginning of intercollegiate sports, the role of athletics within higher education has been a topic of heated debate. (1) Whether to invest funds into building a new football stadium or to improve a school's library can cause major disagreements. Lately the debate has become especially contentious as a result of widely publicized scandals involving student athletes and coaches and because of the increasing amount of resources schools must invest to remain competitive in today's intercollegiate athletic environment. Congress has recently begun to question the National Collegiate Athletic Association's (NCAA) role in higher education and its tax-exempt status. Representative Bill Thomas asked the president of the NCAA, Dr. Myles Brand, in 2006: "How does playing major college football or men's basketball in a highly commercialized, profit-seeking, entertainment environment further the educational purpose of your member institutions?" (2)

   Some analysts would answer Representative Thomas's question by suggesting that sports does not further the academic objectives of higher education. They would argue that intercollegiate athletics is akin to an "arms race" because of the rank-dependent nature of sports, and that the money spent on athletic programs should be used to directly influence the academic mission of the school instead. However, others suggest that because schools receive a variety of indirect benefits generated by athletic programs, such as student body unity, increased student body diversity, increased alumni donations, and increased applications, athletics may act more as a complement to a school's academic mission than a substitute for it. Until recently, evidence for the indirect benefits of the exposure provided by successful athletic programs was based more on anecdote than empirical research. (3) Early work by Coughlin and Erekson (1984) looked at athletics and contributions but also raised interesting questions about the role of athletics in higher education. Another seminal paper (McCormick and Tinsley 1987) hypothesized that schools with athletic success may receive more applications, thereby allowing the schools to be more selective in the quality of students they admit. They used data on average SAT scores and in-conference football winning percentages for 44 schools in "major" athletic conferences for the years 1981-1984 and found some evidence that football success can increase average incoming student quality. (4) Subsequent research has further tested the increased applications (quantity effect) and increased selectivity (quality effect) hypotheses of McCormick and Tinsley but has produced mixed results. (5) The inconsistent results in the literature are likely the product of (1) different indicators of athletic success, (2) a limited number of observations across time and across schools, which has typically necessitated a cross-sectional analysis, and (3) different econometric specifications.

   This study extends the literature on the indirect benefits of sports success by addressing some of the data limitations and methodological difficulties of previous work. To do this we constructed a comprehensive data set of school applications, SAT scores, control variables, and athletic success indicators. Our data set is a panel of all (approximately 330) NCAA Division I schools from 1983 to 2002. Our analysis uses plausible indicators for both football and basketball success, which are estimated jointly in a fixed effects framework. This allows a more comprehensive examination of the impact of sports success on the quantity and quality of incoming students. Using this identification strategy and data, we find evidence that both football and basketball success can have sizeable impacts on the number of applications received by a school (in the range of 2-15%, depending on the sport, level of success, and type of school), and modest impacts on average student quality, as measured by SAT scores.

   Because of concerns with the reliability of the self-reported SAT scores in our primary data set, we also acquired a unique administrative data set that reports the SAT scores of high school students preparing for college to further understand the average "quality" of the student that sports success attracts. These individual-level data are aggregated to the school level and allow us to analyze the impact of sports success on the number of SAT-takers (by SAT score) who sent their SAT scores to Division I schools. Again, the panel nature of the data allows us to estimate a fixed effects model to control for unobserved school-level variables. The results of this analysis show that sports success has an impact on where students send their SAT scores. This analysis confirms and expands the results from the application data set. Furthermore, this data makes it clear that students with both low and high SAT scores are influenced by athletic events. (6)

   Besides increasing the quality of enrolled students, schools have other ways to exploit an increased number of applications due to sports success: through increased enrollments or increased tuition. Some schools that offer automatic admission to students who reach certain quality thresholds may be forced to enroll more students when the demand for education at their school goes up. Using the same athletic success indicators and fixed effects framework, we find that schools with basketball success tend to exploit an increase in applications by being more selective in the students they enroll. Schools with football success, on the other hand, tend to increase enrollments.

   Throughout our analysis, we illustrate how the average effects that we find differ between public and private schools. We find that this differentiation is often of significance. Specifically, we show that private schools see increases in application rates after sports successes that are two to four times higher than seen by public schools. Furthermore, we show that the increases in enrollment that take place after football success are mainly driven by public schools. We also find some evidence that private schools exploit an increase in applications due to basketball success by increasing tuition rates.

   We think that our results significantly extend the existing literature and provide important insights about the impact of sports success on college choice. As Siegfried and Getz (2006) recently pointed out, students often choose a college or university based on limited information about reputation. Athletics is one instrument that institutions of higher education have at their disposal that can be used to directly affect reputation and the prominence of their schools. (7) Our results suggest that sports success can affect the number of incoming applications and, through a school's selectivity, the quality of the incoming class. Whether or not the expenditures required to receive these indirect benefits promote efficiency in education is certainly not determined in the present analysis. Nonetheless, with the large and detailed data sets we acquired, combined with the fixed effect specification that included both college basketball and football success variables, while controlling for unobserved school-specific effects, it is our view that the range of estimates showing the sensitivity of applications to college sports performance can aid university administrators and faculty in better understanding how athletic programs relate to recruitment for their respective institutions.

   Section 2 of this article provides a brief literature review of previous work that has investigated the relationship between a school's sports success and the quantity and quality of students that apply to that school. Section 3 describes the data used in the analysis. Section 4 presents the empirical strategy for identifying school-level effects due to athletic success. Section 5 describes the results from the empirical analysis. Section 6 concludes the study.

2. Literature Review

   Athletics is a prominent part of higher education. Yet the empirical work on the impact of sports success on the quantity and quality of incoming students is surprisingly limited. Since the seminal work by McCormick and Tinsley (1987), there have been a small number of studies that have attempted to provide empirical evidence on this topic. In this section we review these studies to motivate the present analysis.

   Table 1 provides a summary of the previous literature. (8) The table is divided into two panels. Panel A describes the studies that have directly or indirectly looked at the relationship between sports success and the quantity of incoming applications. These studies have found some evidence that basketball and football success can increase applications or out-of-state enrollments. Panel B describes the studies that have looked at the relationship between sports success and the quality of incoming applications. These studies all reanalyze the work of McCormick and Tinsley (1987) using different data and control variables. The results of these studies are mixed. Some of these analyses find evidence for football and basketball success affecting incoming average SAT scores; whereas, others do not.

   Differences in how the studies measured sports success make it difficult to compare the primary results of these studies. For example, Mixon and Hsing (1994) and McCormick and Tinsley (1987) use the broad measures of being in either various NCAA and National Association of Intercollegiate Athletics (NAIA) athletic divisions or "big-time" athletic conferences to proxy prominent and exciting athletic events at a university. Basketball success was modeled by Bremmer and Kesselring (1993) as being the number of NCAA basketball tournament appearances prior to the year the analysis was conducted. Mixon (1995) and Mixon and Ressler (1995), on the other hand, use the number of rounds a basketball team played in the NCAA...