Inside Higher Ed has a story today regarding the just-released study Rich Vedder has done for the Mackinac Center, finding that increasing expenditures on higher ed is not a means by which a state can raise its level of prosperity.

The story is fair, but naturally IHE had to seek out someone from the Higher Ed Establishment to cast doubt on Vedder’s conclusion that increasing state higher ed spending is, if anything, going to decrease economic growth. It turned to Cornell’s Ronald Ehrenberg, who offered the notion that possibly “the poorest states were pumping the most funding into higher education in an attempt to boost growth in the future — a theory that would explain the negative correlation.” (Words of the author of the story.)

Well no, it wouldn’t. Even if there is some lag time between the onset of increased higher ed spending and the economic results, that wouldn’t account for a negative correlation. I think that Vedder has seriously embarrassed the Higher Ed Establishment by demonstrating that higher ed expenditures do not correlate with economic growth and by offering a sound set of explanations for his finding –that much higher ed spending has nothing to do with putting students through courses, that almost all of the really able students are already going to college, and that alternative uses of resources are more apt to produce economic growth in a state.

The wheels are coming off the old idea that the more students a state puts through college, the faster its economic engine runs.