A Video Game of the Trump Higher Education Compact, Seriously
This past October, the Trump administration invited nine universities to respond to a proposed White House Compact for Academic Excellence in Higher Education. The proposal includes both foundational principles and actions that will impact university finances. Our purpose here is not to comment on the pros and cons of the Compact or its overall desirability but rather on means for estimating the financial effects.
Twenty-five years ago, with Hong Kong-based video game designer Trevor Chan, we developed and released the first numerical simulation of the American university, Virtual U. Virtual U enabled the player to preside over a university and to face some of the extant challenges of higher education. Players were responsible for establishing and monitoring all the major components of an institution, spanning faculty salaries to campus parking. Moving around the campus, the player gathered information to make decisions such as decreasing faculty teaching time or increasing athletic scholarships. Virtual U modeled attitudes and behaviors in five major areas: spending and income decisions, such as operating budget, new hires, incoming donations, and management of the endowment; faculty, course, and student scheduling issues; admissions standards, university prestige, and student enrollment; student housing, classrooms, and other facilities; and performance indicators.
Players watched the results of their decisions unfold in real-time, and a letter of review from Virtual U's board each “year” (of play) informed players of their progress in a numerical score. This changed their qualitative views about how universities operate: in particular, that these complex institutions must be viewed as interactive systems. Virtual U enjoyed a minor success as a high-tech approach to university management and a frontier in higher education research.
The ideas in Virtual U have evolved to the point where quantitative modeling can illuminate important financial and operational consequences of the policies and actions proposed in the Compact. The Compact describes policies in eight areas: 1) equality in admissions; 2) marketplace of ideas and civil discourse;3) nondiscrimination in faculty and administrative hiring; 4) institutional neutrality; 5) student learning; 6) student equality; 7) financial responsibility; and 8) foreign entanglements. Importantly, the Compact also calls for enforcement and annual certification of compliance.
Along with political and cultural impacts, universities should consider the financial and operational consequences that might arise from changes due to compliance with the proposed Compact. We’ll focus on the primary effect, changes in the number and mix of enrollments.
Some of the Compact’s proposals will reduce enrollments and, hence, net tuition revenue. Requirement (1) about equality in admissions may reduce enrollments in certain student segments and, concomitantly, demand for courses in certain subject areas. This will reduce tuition revenue, perhaps offset by changes in financial aid if the affected segments are disproportionately self-sufficient or needy. Shrinking or rising demand for particular courses creates imbalances with faculty, which can be adjusted only with time lags stretching over years or decades, depending on faculty flexibility.
Requirement (7) about financial responsibility will freeze tuition rates for some students, require refunds for some, and exempt others. Estimating the institution’s ability to attract replacement students and the financial aid requirements of those students will be a big challenge. Similarly, requirement (8) about foreign entanglements implies changes in demand for a variety of courses as well as services such as housing and student support, and the ability to meet needs for teaching and research assistants. Figures for “before” and “after” enrollments are prerequisites for any kind of serious modeling of these proposals.
Gross modeling of enrollment effects would focus on aggregate net revenue losses. Initially, the models would be simple spreadsheets based on the “before” and “after” enrollment data described. Fine-structure modeling of universities’ academic and non-academic operations could improve on gross modeling by, for instance, looking at enrollments in particular degree programs. This would require representative data for, say, research/doctoral universities and master's/undergraduate universities. Some current models have the structures needed for enrollment and instructional activities (including student segments) with placeholders for faculty research. Costs of administrative and support services could be added.
Estimating cost savings is harder because calculating aggregate incremental cost is difficult. Use of more readily available average cost per student (or faculty) is problematic because average cost differs significantly from the incremental costs.
Cost-saving adaptations that universities could make in response to the enrollment losses are also important. These could include reshaping the program portfolio: growing, shrinking, or sunsetting programs, or adding new programs, in response to enrollment losses and any rethinking of institutional priorities. It could also include boosting curricular efficiency: finding ways to reduce excess course capacity and to optimize teaching resource utilization without degrading educational quality.
Issues of “academic freedom” and political control probably will dominate institutional decisions on the Compact. And putting federal contracts at greater risk than they are now might, for some institutions, swamp the enrollment revenue differences discernible with gross or more fine-structure modeling. However, at least gross modeling of revenue losses seems worthwhile if the requisite “before” and “after” enrollment estimates can be obtained. Later releases of a game could extend beyond finances.
Whether the results from the simulation would rally opposition to the Compact, we do not know. We do think the response so far in this encounter between higher education and the White House shows that modeling and simulation of these institutions remains primitive. A stronger capacity to simulate the behavior of universities could help these institutions “survive and thrive," to use the vernacular of gamers.
And should compacts of the kind proposed come into existence, the models and the data whose collection they encourage could help certify compliance and brace arguments for modification of policies and requirements. Maybe university leaders can learn something from builders and players of World of Warcraft and Fortnite. It’s time for a new generation of simulations in the spirit of Virtual U.
