The Determinants of Research Production by U.S. Universities

In this paper, we analyze the determinants of the production of research by higher edu- cation institutions in the U.S.. We use the information contained in the Shanghai ranking to estimate their performance in the production of top level academic research. We show that it is important to account for the presence of outliers, in both dimensions (x and y axes), among institutions. It appears that most of the top ranked institutions must be con- sidered as outliers. We also treat the endogeneity issue and test for the possible selection bias. We find that the income, the share of this income devoted to expenses in research and the number of professors very significantly increase the ability of an institution to produce top level academic research. We also show that the relationship between the average quality (salary) of professors and the production of research is U-shaped with a significant share of institutions located on the decreasing part of the curve.