Although a recent study about economic efficiency in college athletics placed Ohio University near the top of the nation, speculation has arisen about the study's effectiveness and credibility.
The study, released annually by the Laboratory for the Study of Intercollegiate Athletics at Texas A&M University, ranks Football Bowl Subdivision (formerly Division I) universities based on a formula emphasizing conference and national championships.
Ohio finished 12th in the study. The Excellence in Management Cup, given to the top school every year, was awarded to Kent State.
Despite the success, renowned economist Richard Vedder questions the significance of the study, and Faculty Senate Chairman Joseph McLaughlin doubts the relevance of the findings in relation to university budget issues.
I like being recognized for economic efficiency in our athletic department
said Jim Schaus, director of athletics. It's extremely important. The study exemplifies that some programs including ours are getting things out from what they're putting in.
Last year, OU finished 53rd in the study, with Utah State ranking first.
The formula calculated a school's athletic success compared with total athletic operating expenses. The university's number of national championships is multiplied by six and added to its number of conference championships. Each of these two figures is then divided by the number of sports each school offers.
Researchers then divide that number by the total athletic operating expenses for each university and the final number is multiplied by 100,000 to make it more manageable, said Dr. Shane Hudson, director of the laboratory at Texas A&M.
We really wanted to give smaller schools a better chance in this one
Hudson said. Other studies don't take into consideration that bigger schools are much more likely to win championships. They offer more sports and have more money to win with.
Hudson added that the goal of the department's study was to award athletic departments that can translate limited resources into championships.
Ohio finished third in the Mid-American Conference this year behind champion Kent State and Central Michigan, which finished fourth.
Despite OU being ranked higher than every school in several major conferences, the study does not take into consideration the opportunity cost of each school's athletic budget.
An economic principle, opportunity cost means the value of the next best option. It is the relationship between scarcity and choice, and is important in determining that scarce resources are used efficiently, Vedder said.
It's a simple measure of cost-benefit analysis
he said. When a school loses over $15 million on athletics on a yearly basis
you have to start considering some of the other things it could do with that money.
In a Board of Trustees meeting last Thursday, McLaughlin questioned the trustees' spending habits. He directed some of his strongest criticism toward the athletic department.
We understand the university has budget problems
but over the last two years
the intercollegiate athletics department has been given $2 million in revenue to fund its activity
while less money has been given to tenure and tenure-tracked faculty
McLaughlin said in an interview.
Schaus said his department's efforts help put a brand on the university, despite the criticism.
I think we were on ESPN eight times last year
Schaus said. That helps someone identify just what this university is all about and who we are. If we expect to compete and keep growing as a school
