These 20 colleges took in 28% of donations to universities last year — they educate 1.6% of undergrads

Personal Finance


As with many sectors of our society these days, when it comes to colleges there are haves and have-nots.

The 20 colleges that received the most money in donations during the last fiscal year accounted for about 28% of the total $46.73 billion donated to universities during that period. They serve just 1.6% of the nation’s 19.9 million undergraduate students. That’s based on an analysis of the annual Voluntary Support for Education survey, published by the Council for Advancement and Support of Education, a membership association for professionals working in development, alumni relations and related fields for educational institutions.

The 20 schools who brought in the most donation money last year and their undergraduate enrollments, according to U.S. News & World Report
School Dollar amount received in donations Number of undergraduate students
Harvard University  $1,418,702,174 6,766
Stanford University  $1,097,060,553 7,062
Columbia University   $1,009,762,418 6,162
University of California-Los Angeles  $786,650,878 31,002
University of California-San Francisco $730,268,012 0
Johns Hopkins University  $723,599,227 6,109
University of Pennsylvania $717,529,290 10,033
University of Washington  $711,063,379 31,331
University of Southern California  $649,970,748 19,170
Yale University $585,947,376 5,746
University of Chicago  $576,037,944 6,264
Duke University  $516,890,154 6,692
Cornell University $507,295,262 14,907
University of Notre Dame  $502,771,320 8,576
New York University  $502,407,219 26,417
University of Michigan   $490,035,112 28,983
Massachusetts Institute of Technology  $469,932,565 4,547
Ohio State University  $436,973,769 45,946
University of California-Berkeley  $419,365,625 30,574
Indiana University   $408,461,793 33,429

The survey is the latest evidence that a small group of colleges capture much of our country’s attention — and resources — even while community and public regional colleges do the yeoman’s work of educating the nation’s nearly 20 million college students. It also adds fuel to critics who say that the nation’s richest schools aren’t using enough of their resources to become the engines of economic mobility we typically imagine higher education institutions to be.

A self-perpetuating system built on wealth

‘If let’s say three decades from now [a major donation] leads to a cure for malaria or cancer treatment with a three day course of pills, I think it would be very difficult to argue that that money maybe should have gone to a more immediate cause.’


— Jonathan Meer, economist at Texas A&M University

“Large charitable donations to the richest schools is essentially the endpoint of a cycle that rewards wealth every step along the way,” said Ben Miller, the senior director of postsecondary education at the Center for American Progress, a left-leaning think tank. Typically, Miller said, these schools start out relatively wealthy and enroll a large share of relatively wealthy students who then go on to get lucrative jobs that are hard to get without those elite degrees.

These wealthy graduates then turn around and give that money back to their relatively wealthy alma maters. “It raises questions for me about why donors are choosing to do it,” Miller said.

Miller acknowledged that super-rich donors to universities do seem to be doing more to use their money to expand opportunity for low-income or other students under-represented in higher education. Michael Bloomberg focused his $1.8 billion donation to Johns Hopkins University last year on financial aid.

Still, expanding access to the nation’s elite universities, where most mega-donations in higher education end up, wouldn’t do much to expand access to college overall because these schools educate such a small share of the nation’s students, Miller said.

“If these donations were truly motivated by a broader goal of improving college completion or something like that, they would definitely be going to large regional four-year schools and community colleges,” he said.

‘What happens to all the causes that don’t please their whims? What happens to all the universities that don’t happen to fill them with nostalgia?’


— Anand Giridharadas, the author of “Winners Take All”

It’s not just about education — donations fund campus hospitals and museums

Of course donations to name-brand universities are motivated by a variety of factors, other than just increasing college access and completion. Ann Kaplan, the senior director of the Voluntary Support of Education Program, said that the schools that take in the bulk of donations to colleges are multi-faceted nonprofits with hospitals, art museums, research facilities and other institutions that could capture donors’ interest.

“You get donors to hospitals, research facilities, arts organizations that go beyond the interest of donors that are focused more keenly on the education aspect of the institution,” Kaplan said.

That’s very different from the perhaps more teaching-focused community or regional colleges. These schools don’t have as long of a history of fundraising as private nonprofit colleges, but Kaplan said she expects that as they ramp up their development efforts, community colleges will raise more money because they have good cases for support.

Donations may lead to ‘societal benefits in the distant future’

Right now, donors giving to wealthy, multi-faceted higher education institutions may be betting on the idea that gifts to these schools can arguably have a major impact outside of simply expanding access to college, said Jonathan Meer, an economist at Texas A&M University who studies charitable giving and the economics of education.

“There’s the question of which universities are doing the basic research that may be leading to very large societal benefits in the distant future,” Meer said. “If let’s say three decades from now [a major donation] leads to a cure for malaria or cancer treatment with a three day course of pills, I think it would be very difficult to argue that that money maybe should have gone to a more immediate cause.”

For some donors the idea that expanding access to elite, relatively small institutions can arguably have a ripple effect, may be appealing, Meer said. Because these schools produce graduates that have a disproportionate amount of influence, getting more low-income or other under-represented students into them has the potential to change the lives of more than just the students who benefit directly from the education.

Still, Meer notes, as a researcher on the economics of altruism he’s well-aware that donors have prestige motivations for giving. “They get consumption value themselves from being celebrated, from seeing their name on things,” he said. “Maybe seeing your name on your alma mater means more to you than seeing your name on something else.”

And indeed, the colleges with the most billionaire graduates, according to Wealth-X, which tracks ultra high net worth individuals, are all among the 20 schools that pulled in the most in donations last year.

The wealthy’s inordinate power is sign of a broken system, says one critic

That rich people have so much discretion to affect which causes and institutions have the most resources and power is a sign of a broken system, said Anand Giridharadas, the author of “Winners Take All”, a book that investigates how the wealthy use philanthropy to maintain their power.

That system, argues Giridharadas, allows the rich to accumulate wealth at the expense of institutions and people that might have more money if the wealthy paid more in taxes.That system then puts those wealthy people in a position “to privately fund all manner of causes, including education, according to their gilded whims,” Giridharadas said.

“What happens to all the causes that don’t please their whims? What happens to all the universities that don’t happen to fill them with nostalgia?” he said. “Unfortunately rich guys just deciding to give something where they want is seldom aligned to what would deliver the most impact.”

One way that colleges could start doing more to align these donations with impact is by barring donors from dictating how their money is spent, Giridharadas said. That way the schools could choose to put the money towards whatever causes — whether it’s financial aid, research or something else — that they believe would best further their mission, he said.

“It’s very uninspiring when you’re 19-years-old to be walking in a beautiful quad and see the name of hedge fund managers,” he said.

Get a daily roundup of the top reads in personal finance delivered to your inbox. Subscribe to MarketWatch’s free Personal Finance Daily newsletter. Sign up here.

Jillian Berman covers student debt and millennial finance. You can follow her on Twitter @JillianBerman.

We Want to
Hear from You

Join the conversation



Leave a Reply

Your email address will not be published. Required fields are marked *