Investing in People: Assessing the Economic Benefits of 1890 Institutions.

Abebayehu Tegene, Anne Effland, Nicole Ballenger, George Norton, Albert Essel,

Gerald Larson, and Winfrey Clarke. U.S. Department of Agriculture, Economic

Research Service. Miscellaneous Publication Number 1583.

Abstract

The 1890 land-grant universities (1890s) have developed teaching, research, and

extension programs that reach historically underserved students and communities.

Many studies have described the programs of 1890s, but no systematic effort has

measured their contribution to human capital development and to improving the

well-being of the rural population. This report examines the historical USDA

funding levels of the 1890 institutions; discusses the outcomes of these investments and potential measurable indicators of these outcomes; and outlines a conceptual model for estimating returns to investment in education tailored to particularities of the 1890s.

Keywords: 1890s, land-grant universities, human capital, extension service, agricultural research, research funding 

Acknowledgments

The authors wish to thank the authors and participants at the 1890/ERS workshop

in September 1999. In preparing this report, we have benefited from many of the

ideas discussed at the workshop. For their comments on earlier drafts, we also

wish to thank McKinley Mayes, Doris Newton, Katherine Ralston, Dave

Weatherspoon, and Keith Wiebe. We appreciate the great help Michael LeBlanc

provided in improving the presentation of the report. The authors would like to

acknowledge Melody Mathis-Pace for her outstanding contribution with the tables,

charts, and text. Finally, we want to thank the editor, Shashunga Clayton, for doing

a great job, and Vic Phillips for his creative design.

Author affiliation: Abebayehu Tegene and Nicole Ballenger are with the Food and

Rural Economics Division, ERS, USDA; Anne Effland is with Market and Trade

Economics Division, ERS, USDA; Gerald Larson is with the Office of Budget and

Planning Analysis, USDA; George Norton is with Virginia Polytechnic Institute

and State University; and Albert Essel and Winfrey Clarke are with Virginia State

University. 

1800 M Street, NW

Washington, DC 20036-5831 March 2002

Photo Credits:

Keith L. Pope, Florida A&M University, Public Affairs (center photo)

Ken Hammond, USDA (top right photo)

John Oubre, Southern University, Office of Publications (all other photos)
ii ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Foreword

To enhance the relationship between the U.S. Department of Agriculture and 1890

land-grant universities and colleges, the Economic Research Service (ERS) entered

into cooperative agreements in 1997 with four 1890 institutions—Delaware State

University, South Carolina State University, Tuskegee University, and Virginia State

University. The purpose of this collaboration was to study outcomes and benefits of

investments in the 1890s’ programs in the food and agricultural sciences, to explore

methods of better quantifying benefits, and to improve effectiveness of Federal

(USDA) investments in the 1890s’ programs and initiatives. To accomplish these goals,

cooperators initiated an effort to design a framework for measuring USDA’s investments and for identifying, classifying, and quantifying (or otherwise assessing) the

outcomes of these investments. 

As a first step, the cooperators posed a series of core questions, which form the focus

of this report. How have the programs at the 1890s been funded? What have been the

outcomes of these programs? What are the best indicators by which to measure those

outcomes? And how can conceptual models best be developed for estimating future

returns to investments in these programs? This report synthesizes a number of papers

presented at a workshop held September 1 and 2, 1999, at USDA’s Economic

Research Service, drawing particularly from three studies—Essel, Clarke, and Tegene

(1999); Norton and Tegene (1999); and Larson (1999).

The 1890 land-grant universities help ensure a more equitable distribution of educational opportunities. Photo courtesy Keith Pope.
Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ iii

Contents

Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ii

Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Legislative History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Funding the 1890 Institutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

Funding for Teaching Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

Funding for Research Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

Funding for Extension Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

Identifying Measurable Administrative Indicators . . . . . . . . . . . . . . . . . . . . .12

Teaching Outcomes and Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

Research Outcomes and Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

Extension Outcomes and Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14

Exploring Conceptual Frameworks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

Human Capital Theory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

Measuring Returns to Human Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

Returns to Research and Extension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

Next Steps for the Partnership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

Appendix A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

Appendix B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
Summary

The connections between education and the economy are complex and interdependent.

The economy affects the attractiveness of education by creating incentives or disincentives to continue schooling. Family structure and emphasis on and access to learning

resources and experiences also help determine educational success. The 1990s witnessed increasing rewards to higher education and heightened economic incentives for

additional schooling. Given this increased demand for education, access to and supply

of higher education underpin the future productivity of American workers and longterm economic health and growth of our country.

The 1890 land-grant universities (1890s) help to ensure a more equitable distribution

of educational opportunities. They were established by the Second Morrill Act in 1890

to provide equal educational opportunities for African-American students who had

been denied admission to their States’ original 1862 land-grant universities. The 1890s

have developed teaching, research, and extension programs that serve mainly rural

communities. African-American students receive undergraduate and graduate education at the 1890 universities in an environment particularly attuned to the needs of

minority students. Research and extension programs address issues of special interest

to minority rural communities and small-scale and limited-resource farm operators, as

well as more traditional topics reflecting the expertise and interests of the 1890 faculty

and graduate students.

USDA has strengthened links to the 1890 institutions by building a stronger base of

funding support. USDA’s Economic Research Service (ERS) entered into cooperative

agreements in 1997 with four 1890 institutions to study outcomes and benefits of

USDA investment in the 1890 institutions’ food and agricultural programs. The collaboration has explored core issues of the programs’ funding and achievements, the best

indicators by which to measure those achievements, and the development of conceptual models for estimating the future returns to investments in these programs.

Many studies have described the programs of the 1890s, but there has been no systematic effort to measure the economic contribution of their teaching, research, and extension programs to human capital development and to improving the well-being of the

population they serve. As public funding of research and development falls under

increasing scrutiny and worthy educational investment opportunities multiply, linking

identifiable outcomes and measurable indicators with public investments in the 1890s

is increasingly important.

The 1890 land-grant universities began receiving Federal funds for research in 1967,

which totaled $283,000 per year through 1971. From 1972 to 1978, annual appropriations for research and extension increased from $12.9 million to $23.5 million; and

they began to receive specifically authorized research formula funds (section 1445)

and extension formula funds (section 1444) with the enactment of the National

Research, Extension, and Technology Policy Act of 1977. This statute provided permanent formula funding authorization for research and extension in the 1890s similar to

funding research and extension at 1862 land-grant universities. Total USDA funding of

the 1890s—including funds for research, extension, and general support—rose from

about $1.4 million in 1967 to about $100 million in 2000. 

iv ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA
Federal research funding to land-grant universities has been through formula funds,

which provide guaranteed funding according to a specified formula, special grant

funds, and competitive grants. Federal sources constitute 83 percent of the total

research funds at the 1890s; extension programs at the 1890 universities are almost

entirely supported by Federal funding through the Cooperative State Research,

Education, and Extension Service. Financial support for teaching has come largely

from State governments. Federal support is still significant, however, for funding

scholarships and for enhancing the capacity of 1890 institutions to develop and

improve teaching programs. 

Traditional administrative indicators of benefits associated with teaching, research, and

extension require clear statements of expected outcomes and measurable indicators that

allow monitoring of investments. Assessments of teaching programs in food and agricultural sciences have been limited to measuring the number of successful graduates

that pursue further education and become leaders in their professions. Studies of

research outcomes often use publication and/or patent counts. These methods may

underestimate the research accomplishments of the 1890s. Research at the 1890s has

focused on small-scale farmers and limited-resource families, including research on

minor livestock species, such as goats and rabbits, that are suited to small-farm operations. Many of the research outcomes associated with the 1890 universities are not published or patented, and most institutions do not have a working paper series. Other indicators that better capture the contribution of the 1890s need to be designed. Ideally,

these indicators would capture not only benefits to traditional agricultural stakeholders,

but also impacts on economic development in the 1890s’ target rural areas. 

Similarly, improved indicators of extension programs are needed. Extension programs

have typically documented and reported program inputs: the number of people participating, number of workshops and meetings held, number of educational materials distributed, and number of hours of volunteer service delivered. Extension programs,

however, have not documented outcomes (e.g., changes in knowledge, skills, or aspirations; newer and more efficient methods adopted as a result of the program; or

changes in social, economic, or environmental conditions). 

The Human Capital Model (HCM) provides, at least for measuring benefits of teaching, an alternative to traditional administrative approaches. Education helps people

capitalize on technological and social changes, making them more productive and efficient. It raises their incomes, thereby generating measurable impacts (e.g., earnings

gaps between 1890 and high school graduates) that can be attributed to the colleges. 

However, several issues must be addressed to apply such an approach to measuring

human capital benefits of the 1890s. The models must be structured to disentangle the

effects of inherent ability, other personal characteristics, and job location from the

effects of an 1890 education, a challenge for any attempt to estimate the value of higher education. Also, because available data sets that cover earnings, level of education,

personal characteristics, and other variables needed to estimate the value of higher

education may not indicate the college attended, it may be necessary to survey 1890

graduates in order to complete an empirical evaluation.

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ v
Economic returns to investments in research and extension programs at the 1890s can

be measured by estimating the value of productivity gains using one of two approaches: economic surplus analysis and production function estimation. The economic surplus approach evaluates productivity changes that can be attributed to research. The

production function approach relies on statistical relationships between agricultural

output and expenditures on research (and extension). However, the contribution to productivity change of a specific institution or group of institutions, which is needed to

apply economic surplus analysis, is difficult to identify, particularly for small programs like those at the 1890s. Similarly, production function estimation would be difficult because research and extension at 1890s is a relatively small portion of total

agricultural research and extension in the United States. Given the limitations of the

two standard approaches, a more pragmatic approach to estimate economic impacts of

research and extension at 1890s is to conduct case studies. These studies would rely

on cost-benefit analyses of a sampling of specific programs or projects to draw broader conclusions.

As a next step in developing these frameworks for measuring investments in 1890 programs, a team of researchers from ERS, Virginia State University, Virginia Polytechnic

Institute and State University, University of Arkansas – Pine Bluff, and Langston

University has begun work, with the support of USDA’s National Research Initiative,

on further developing a human capital model applicable to the 1890s’ teaching programs and on pursuing a series of cost-benefit analysis case studies of 1890s’ research

and extension projects. 

vi ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

The 1890 land-grant universities play a significant role in training students from various ethnic minorities in agricultural and food sciences, engineering, mathematics, and other disciplines. Photo courtesy Keith Pope.
Introduction

The connections between education and the economy

are complex and interdependent. The economy affects

the attractiveness of education by creating incentives

and disincentives to continue schooling. Family structure and access to learning resources and experiences

also help determine educational success. The 1990s

witnessed increasing rewards to higher education and,

therefore, heightened economic incentives for additional schooling. Given this increased demand for education, access to and supply of higher education will

underpin the future productivity of American workers

and long-term economic health and growth of our

country.

The 1890 land-grant universities (1890s) help ensure a

more equitable distribution of educational opportunities. They were established by the Second Morrill Act

in 1890 to provide equal educational opportunities for

African-American students who had been denied

admission to their States’ original 1862 land-grant universities. The 1890s have developed teaching,

research, and extension programs that serve mainly

rural communities. African-American students receive

undergraduate and graduate education at the 1890 universities in an environment particularly attuned to the

needs of minority students. Research and extension

programs address issues of special interest to minority

rural communities and small-scale and limitedresource farm operators, as well as more traditional

topics reflecting the expertise and interests of the 1890

faculty and graduate students.

USDA has strengthened links to the 1890 institutions

by building a stronger base of funding support.

USDA’s Economic Research Service (ERS) entered

into cooperative agreements in 1997 with four 1890

institutions to study outcomes and benefits of USDA

investment in the 1890s’ food and agricultural programs. The collaboration has explored core questions

of how these programs have been funded, what have

been the outcomes of these programs and what are the

best indicators by which to measure those outcomes,

and how to develop conceptual models for estimating

the future returns to investments in these programs.

Many studies have described the programs of 1890s,

but there has been no systematic effort to measure the

economic contribution of the 1890s’ teaching,

research, and extension programs to human capital

development and to improving the well-being of the

population they serve. As public funding of research

and development falls under increasing scrutiny and

worthy educational investment opportunities multiply,

linking identifiable outcomes and measurable indicators with public investments in 1890s is increasingly

important.

Legislative History

Congress created the land-grant system of colleges and

universities to make practical higher education accessible to working families. The land-grant system took

shape through four pieces of landmark legislation,

amended over time, that endowed the colleges and universities in the system with three missions: teaching,

performing agriculture-related research, and providing

extension services to farmers. 

The first piece of legislation, the Morrill Act of 1862,

provided a grant of public land to each State and U.S.

territory to fund a perpetual endowment for at least

one institution to teach “agriculture and the mechanical arts.” The legislation established a network of public institutions still known as the 1862 land-grant colleges and universities. Every State has established at

least one 1862 institution using the funds from the sale

of its allotment of public land. 

The Hatch Act of 1887 created the State Agricultural

Experiment Stations (SAESs) under the auspices of the

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 1

Investing in People

Assessing the Economic Benefits

of 1890 Institutions

Abebayehu Tegene, Anne Effland, Nicole Ballenger, George Norton,

Albert Essel, Gerald Larson, and Winfrey Clarke
land-grant universities. Research funded by the Hatch

Act provided teaching material for professors and

strengthened the scientific basis of the curriculum.

Funds appropriated under the Hatch Act are allocated

among the States according to a statutory formula based

on each State’s farm and rural population. In States having two experiment stations, funds are divided as determined by the State legislature (USDA, 1994). 

The Second Morrill Act, passed in 1890, provided for

annual appropriations to each State to support its landgrant college. The act also forbade racial discrimination in admission policies for colleges receiving these

Federal funds, but granted States the right to establish

separate colleges for Black and White students. The

act required Federal funds to be divided between a

State’s land-grant colleges and universities in a “just,”

but not necessarily equal, manner. 

Southern States established separate Black colleges.

Maryland assigned its money to a private Black college that subsequently became a State institution.

Alabama, Arkansas, Florida, Texas, Kentucky,

Virginia, Mississippi, and Missouri gave portions of

the funds to existing public Black schools. Delaware,

Georgia, North Carolina, Oklahoma, South Carolina,

Tennessee, and West Virginia created new land-grant

schools for their Black residents (Huffman and

Evenson, 1993).

Thus, the Second Morrill Act led to the establishment

of land-grant colleges for African-Americans, which

are known as the 1890s. Today, 17 institutions, located

predominantly in the southeast region of the United

States, are included in the 1890 system. Of the 17,

Tuskegee University is the only private university. It is

considered an 1890 because it was created by State

legislation and has historically focused on agricultural

research. In addition, beginning in fiscal year 2000,

agricultural appropriations acts have provided that

within the total appropriations for 1890 research and

extension formula programs, $1 million shall be made

available for both research and extension at West

Virginia State College.1

Finally, the Smith-Lever Act, passed in 1914, created

the Cooperative Extension Service as a joint effort of

the U.S. Department of Agriculture, the State landgrant institutions, and individual county governments.

The act provided for this partnership across Federal,

State, and county levels to give instruction and practical demonstrations in agriculture and home economics

in rural areas of the United States. 

2 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Table 1—Development history of 1890 institutions and Tuskegee University 

Initiated Initiated

Year 4-year graduate Regional

Name of Institution founded program program accreditation

Alabama A&M University 1875 1939 1958 1963

Alcorn State University 1871 1871 1975 1961

University of Arkansas-Pine Bluff 1873 1929 NA 1933

Delaware State College 1891 1947 NA 1957

Florida A&M University 1887 1909 1951 1949

Fort Valley State College 1895 1945 1957 1957

Kentucky State University 1886 1929 1972 1939

Langston University 1897 1897 NA 1939

Lincoln University 1866 1935 1940 1945

University of Maryland-Eastern Shore 1886 1936 1978 1953

North Carolina A&T University 1891 1925 1939 1946

Prairie View A&M University 1876 1909 1954 1958

South Carolina State College 1872 1924 1948 1960

Southern University 1880 1922 1957 1958

Tennessee State University 1909 1922 1942 1946

Tuskegee University 1881 1928 1943 1933

Virginia State University 1882 1943 1937 1933

NA = Not available.

Source: Christy and Williamson (1990), p. 32.

1West Virginia abolished the 1890 designation for West Virginia

State College in the wake of Brown vs. Board of Education, the

1954 Supreme Court ruling that ended segregation in public 

education.
Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 3

Year Legislation Purpose

1862 Morrill Act Established the land-grant college system. Gave each State 

30,000 acres of land (for each senator and each of its representatives in Congress) to endow colleges.

1887 Hatch Act Provided annual grant for agricultural research, and established

the State agricultural experiment stations. 

1890 Second Morrill Act Blacks were to be admitted to land-grant institutions. States 

could establish separate land-grant colleges—“the 1890s”

were established. 

1906 Adams Act Provided each State additional Federal funding for agricultural 

research.

1914 Smith-Lever Act Established the Cooperative Extension Service.

1917 Smith-Hughes Act Established Federal grants for vocational education in agriculture, home economics, and industrial arts in public colleges 

and high schools.

1935 Bankhead-Jones Act Established formula funding for research and Federal-State 

matching grants.

1965 Public Law 89-106 Established “Specific Research Grants” program and provided 

research funds collectively for 1890 institutions.

1977 Food & Agriculture Act Provided formula funds to research at 1890 institutions. 

1985 Food Security Act Amended the 1977 act to provide not less than 6 percent of 

Smith-Lever funds to be allocated for extension work at the 

1890 institutions.

1998* Agricultural, Research, Established requirements for State matching of Federal formuExtension, and Education Act la, extension, and research funding of 1890 institutions.

Chronology of Major Legislation Affecting 1890s

Sources: Adapted from NRC (1995) and Christy and Williamson (1992).

*U.S. Department of Agriculture, Cooperative State Research, Education, and Extension Service
Funding the 1890 Institutions

Although the 1890s are part of the same system that

authorizes and governs the 1862 land-grants, lack of

financial resources slowed the 1890s’ growth and

development. For example, no Federal funds were

available to these institutions until 1967 (figs. 1 and 2).

While cross-institution comparisons are difficult to

assess because of differences in missions, the 1890s

have received far less funding relative to 1862 landgrant colleges on a per student basis (Huffman and

Evenson, 1993). Legislatively established funding

mandates for research and extension have not been

appropriated. The actual funding for 1890 research and

extension relative to the minimum amount required

under sections 1445 for research and 1444 for extension is shown in figure 3. On the other hand, actual

funding for extension fell far short of the mandate for

most of the first 10 years, and has exceeded the mandate since 1990, albeit by a lesser amount than for

research. In addition, some federally funded programs

have never been established at 1890 institutions. For

example, the Hatch Act of 1887 authorized funding to

States for scientific research at agricultural experiment

stations, which were to operate under the direction of

an 1862 institution or other substantially equivalent

arrangement (USDA, 1994); no State has established

such an experiment station at an 1890 institution. 

In 1967, through P.L. 89-106, a broad authority for

research grants awarded on a discretionary basis, the

1890s began to receive Federal funds to support

research (USDA, 1994). Funds granted to 1890s under

this program totaled $283,000 per year through 1971

(see table 2). In fiscal year 1972, Congress appropriated $8.8 million for research grants to 1890 institutions.

That same year, Congress appropriated $4.0 million

under section 3(d) of the Smith-Lever Act for extension work specifically at 1890s (USDA, 1994),

although these funds were distributed to the 1890s

through the 1862 land-grants in each State. 

Direct appropriations to support agricultural research

at 1890s started with the enactment of the Evans-Allen

Act as section 1445 of the National Research,

Extension, and Teaching Policy Act (NRETPA) of

4 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

20

40

60

80

100

120

1967 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99

Figure 1

USDA support for 1890s

Funding by program, fiscal year 1967-2000

Source: USDA, Office of Budget and Program Analysis.

Research formula

Capacity building

Extension formula

Other USDA

Construction

Fiscal year

Million dollars

0
1977. This statute provided a permanent funding

authorization for the 1890s similar to the Hatch Act

authorization under which formula funds for research

at 1862 land-grants have been appropriated since 1887

(McDowell and Evans, 1990). Under section 1445,

1890s receive an amount equivalent to no less than 15

percent of the funds appropriated under the Hatch Act

each year (see table 3).

From 1972 to 1978, annual appropriations to 1890s

(under the Special Grants authority for research and

Smith-Lever 3(d) for extension) increased from $12.9

million to $23.5 million. Two-thirds of the funds were

reserved for supporting research in an effort to integrate these institutions into the public agricultural

research system (see table 2). 

The 1890s began to conduct extension and outreach

programs, with emphasis on underserved populations

and communities, shortly after their establishment

under the Second Morrill Act of 1890. However, they

did not receive specifically authorized Federal extension formula funds until enactment of section 1444 of

the National Agricultural Research, Extension, and

Teaching Policy Act of 1977. This act provided for

extension funding directly to the 1890s instead of

through the 1862s as had been done since 1972 under

Smith-Lever 3(d). Under section 1444, 1890s receive

an amount equivalent to no less than 6 percent of

funds appropriated under Smith-Lever annually (see

table 3). 

Total USDA funding of 1890s for the 34 years from

fiscal year 1967 to 2000, including funds for research,

extension, and general support, rose from about $1.4

million in 1967 to about $100 million in 2000. For the

period 1972 through 2000, the average rate of increase

in total funding was 7.3 percent per year. Funding for

research grew at an annual rate of 4.5 percent, while

funding for extension grew at an annual rate of 7.05

percent (see table 2).

The National Research, Extension, and Teaching

Policy Act of 1977 and subsequent Federal legislation

in 1981, 1985, 1990, and 1996 enhanced Federal

financial support to the 1890s. State support for 1890s’

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 5

20

40

60

80

100

120

1967 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99

Figure 2

USDA support for 1890s in constant dollars

Funding by program, fiscal year 1967-2000

Source: USDA, Office of Budget and Program Analysis.

Research formula

Capacity building

Extension formula

Other USDA

Construction

Fiscal year

Million dollars

0
research and extension programs was further strengthened by the Agricultural Research, Extension, and

Education Reform Act of 1998, which required States

in which 1890s are located to phase in, over a 3-year

period (FY 2000-FY 2002), a 50-percent non-Federal

match for each Federal dollar received for research and

extension programs under section 1444 (which funds

extension) and 1445 (which funds research).2 Prior to

this legislation, Federal law required State governments to match the Federal formula-based contributions to research conducted at the experiment stations

located at 1862 institutions; in fact, States contributed

far more than their match requirements (National

Research Council, 1995). However, no such requirements applied to Federal contributions to research

based at 1890 institutions until the 1998 legislation

was enacted.

In fiscal year 2000, the first year of the matching fund

phase-in period, States were required to match 30 percent of the Federal allocation for research and extension programs. In total, States provided a 27-percent

match, and 7 States took advantage of the opportunity

to request a waiver, which was available for fiscal year

2000 only (see tables 3, 4, and 5). Preliminary information for fiscal year 2001 indicates that most States

will have met the applicable 45-percent requirement

(Larson, 2001).

6 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Figure 3

Funding for 1890 research and extension relative to mandates in 1977 farm bill, 1979-2000

Source: USDA, Office of Budget and Program Analysis.

Research 

Extension

Fiscal year

Million dollars

-5

-4

-3

-2

-1

0

1

2

3

4

5

1979 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 2000

2The matching requirement is for 30, 45, and 50 percent for fiscal

years 2000, 2001, and 2002. States could ask for a waiver only for

fiscal year 2000.
Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 7

Table 2—USDA funding for 1890 land-grant institutions and Tuskegee University, fiscal year 1967-2000 

Strengthening/

Research Extension Research capacity

formula formula extension building Other Other

Fiscal year payments1 payments2 construction3 grants4 CSRS5 USDA6 Total

$1,000

1967 283 0 0 0 1,150 NA 1,433

1968 283 0 0 0 1,150 NA 1,433

1969 283 0 0 0 1,150 NA 1,433

1970 283 0 0 0 1,150 NA 1,433

1971 283 0 0 0 1,150 NA 1,433

1972 8,833 4,000 0 0 1,150 NA 14,033

1973 10,883 6,000 0 0 1,150 NA 18,033

1974 10,883 6,000 0 0 1,150 NA 18,033

1975 11,824 6,450 0 0 1,150 NA 19,424

1976 12,706 6,450 0 0 1,150 NA 20,306

TrQr 3,176 1,373 0 0 292 NA 4,841

1977 13,352 8,400 0 0 1,150 NA 22,902

1978 14,153 9,333 0 0 1,150 NA 24,636

1979 16,360 10,115 0 0 1,176 NA 27,651

1980 17,785 10,453 0 0 1,174 NA 29,412

1981 19,270 11,250 0 0 1,177 NA 31,697

1982 21,492 12,241 0 0 270 NA 34,003

1983 22,394 16,241 10,000 0 821 NA 49,456

1984 22,844 17,241 10,000 0 610 NA 50,695

1985 23,474 17,741 10,000 2,000 598 NA 53,813

1986 22,320 16,887 9,508 1,902 1,071 NA 51,688

1987 22,320 16,877 9,508 1,902 5,901 NA 56,508

1988 23,333 18,291 9,508 1,902 499 NA 53,533

1989 24,333 18,291 9,508 1,902 521 6,300 60,855

1990 25,012 21,836 9,508 7,308 888 8,200 72,752

1991 26,346 22,794 9,508 10,250 1,989 10,300 81,157

1992 27,400 24,730 9,508 10,250 1,652 11,800 85,340

1993 27,400 24,730 8,000 10,250 1,302 16,609 88,282

1994 28,157 25,472 7,901 9,917 1,844 16,200 89,491

1995 28,157 25,472 7,901 9,207 1,634 18,700 91,781

1996 27,735 25,090 7,782 9,200 5,242 15,859 90,908

1997 27,735 25,090 7,549 9,200 4,757 21,224 95,555

1998 27,735 25,090 7,549 9,200 4,479 21,696 95,749

1999 29,676 25,843 8,426 9,200 4,844 16,366 94,355

2000 30,676 26,843 12,000 9,200 4,879 16,319 99,917

1 Research formula payments have been made under sec. 1445 of P.L. 95-113 since 1979; payments were made under P.L. 89-106 from 1967 to 1978. 2 Extension formula payments have been made under sec. 1444 of P.L. 95-113 since 1979; funds were provided under Smith-Lever sec. 3(d) from 1972 to 1978. 3 Research/Extension Construction grants were provided through Cooperative State Research Service (CSRS) for research facilities for 1983 to 1987; and through

ES for extension facilities from 1988 to 1992 and for research and extension facilities since 1993.

4 Strengthening grants were funded from 1985 to 1991. Capacity building grants were begun in 1990.

5 Other CSRS includes Morrill-Nelson payments (through 1994); Bankhead-Jones payments (through 1981), and grants under various special and competitive grant

authorities.

6 Other USDA includes work under cooperative agreements, support for students under cooperative education authorities, and liaison officers at 1890 institutions.

NA = Not available.

Sources: USDA budget reports and appropriation history records. Amounts shown in other CSRS and other USDA categories are based on available records,

which are incomplete for years prior to 1989.
8 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Table 3—Comparison of matching requirements and actual match for research at 1890 institutions1,

fiscal year 2000

FY 2000 30 percent required Actual

Institution State allocation match match Difference

Dollars

Alabama A&M University AL 1,619,671 485,901 485,901 0

Tuskegee University AL 1,600,501 480,150 108,893 (371,257)*

University of ArkansasPine Bluff AR 1,421,565 426,470 441,830 15,360

Delaware State University DE 547,577 164,273 203,600 39,327

Florida A&M University FL 1,201,936 360,581 360,581 0

Fort Valley State University GA 1,828,727 548,618 0 (548,618)**

Kentucky State University KY 2,124,022 637,207 637,207 0

Southern University LA 1,295,569 388,671 0 (388,671)**

University of MarylandEastern Shore MD 958,815 287,645 0 (287,645)**

Alcorn State University MS 1,638,116 491,435 3,600,000 3,108,565

Lincoln University MO 2,031,558 609,467 609,467 0

North Carolina A&T 

State University NC 2,618,586 785,576 500,012 (285,564)*

Langston University OK 1,337,442 401,233 401,233 0

South Carolina State University SC 1,406,226 421,868 0 (421,868)**

Tennessee State University TN 1,995,099 598,530 0 (598,530)**

Prairie View A&M University TX 2,664,999 799,500 799,500 0

Virginia State University VA 1,716,752 515,026 515,026 0

West Virginia State College WV 975,000 _ _ 0

Total payments to States 28,982,161 8,402,151 8,663,250 261,099

Note: Funding is provided under section 1445 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (NARETPA). 1 Includes Tuskegee University and West Virginia State College.

Section 1449 of the NAREPTA does not apply to West Virginia State College.

* Waiver requested for the difference.

**Waiver requested.

Source: USDA, Cooperative State Research, Education, and Extension Service.
Funding for Teaching Programs

Although the original driving force for the land-grant

system was the need for higher education for the

majority of the U.S. population, financial support for

the teaching component of the land-grant mission has

since been largely relegated to States. The Federal

Government’s financial support to the land-grant system has been centered on funding research and disseminating research-based knowledge through extension (National Research Council, 1996). In 1995, for

example, while USDA allocated $406 million for

research and $439 million for extension, the allocation

for higher education grants was only $18 million (of

which more than half was for institutional capacity

building in both teaching and research at 1890s)

(National Research Council, 1996). 

The Second Morrill Act did not endow the 1890 institutions with the public land and other resources appropriated for the 1862s, and they were not compensated

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 9

Table 4—Comparison of matching requirement and actual match for extension at 1890 institutions1,

fiscal year 2000

FY 2000 30 percent required Actual

Institution State allocation match match Difference

Dollars

Alabama A&M University AL 1,328,487 398,546 398,546 0

Tuskegee University AL 1,328,487 398,546 91,677 (306,869)*

University of ArkansasPine Bluff AR 1,199,632 359,950 547,383 187,433

Delaware State University DE 433,652 130,096 159,900 29,804

Florida A&M University FL 1,117,451 335,235 335,235 0

Fort Valley State University GA 1,600,131 480,039 0 (480,039)**

Kentucky State University KY 2,004,220 601,266 601,266 0

Southern University LA 1,101,869 330,561 0 (330,561)**

University of MarylandEastern Shore MD 847,013 254,104 0 (254,104)**

Alcorn State University MS 1,311,143 393,343 586,861 193,164

Lincoln University MO 2,002,099 600,630 699,000 98,370

North Carolina A&T

State University NC 2,384,762 715,429 500,000 (215,429)*

Langston University OK 1,196,996 359,099 359,099 0

South Carolina State University SC 1,162,178 348,653 0 (348,653)**

Tennessee State University TN 1,802,935 540,881 0 (540,881)**

Prairie View A&M University TX 2,466,029 739,809 1,546,215 806,406

Virginia State University VA 1,521,996 456,599 456,599 0

West Virginia State College WV 1,000,000 -- 0

Total payments to States 25,809,080 7,442,786 6,281,781 (1,161,003.00)

Note: Funding is provided under section 1444 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (NARETPA). 1 Includes Tuskegee University and West Virginia State College.

_ _ = Section 1449 of the NAREPTA does not apply to West Virginia State College.

* Waiver requested.

**Waiver requested for the difference.

Source: USDA, Cooperative State Research, Education, and Extension Service.

--

Table 5—Required and actual match for 1890 research and extension, fiscal year 2000

30-percent

Program Allocation match Actual match Waiver*

Thousands of dollars

Research (section 1445) 28,982 8,402 8,663 7

Extension (section 1444) 25,809 7,443 6,282 7

Total 54,791 15,845 14,945 7

*Seven States requested waivers in matching requirements for both research and extension funding.

Source: USDA, Cooperative State Research, Education, and Extension Service.
in subsequent legislation (National Research Council,

1996). For example, the Morrill-Nelson grants, which

provided $50,000 annually to each State for land-grant

academic programs, were not accessible to 1890s for

many years, and when they became available the

amounts were minimal. Compensatory efforts have

been made through strengthening and capacity building programs initiated in 1985, which were designed

to enable the 1890s to meet the needs of an expanding

student population (National Research Council, 1996).

Currently, the majority of funds for undergraduate and

graduate instruction at the 1890s come from State governments. However, Federal support is still significant

for funding scholarships and enhancing the capacity of

1890 institutions to develop and improve teaching programs. The major Federal support programs for 1890

land-grant teaching are administered by the USDA

Cooperative State Research, Education, and Extension

Service Office of Higher Education. Federal support

for teaching programs includes:

(1) The teaching components of 1890 Institution

Capacity Building Teaching and Research Grants

Program,

(2) The USDA/1890 National Scholars Program, a

cooperative education program, and

(3) Higher Education Multicultural Scholars Program.

The Capacity Building Grants Program that began in

1990 has become the most significant of these three

Federal sources of funds. USDA awarded 429

Capacity Building Grants between 1990 and 1999, of

which 242 (56 percent) were for teaching projects.3

The teaching grants awarded $41.6 million to strengthen teaching capacity at 1890s (Hood, 1999). USDA

investments made through these programs help to

advance the quality of teaching programs in food, agriculture, and natural resources at 1890 universities.

Funding for Research Programs

Research at land-grant colleges and universities is supported by funds from Federal, State, and private

sources. Federal support for research at land-grant colleges is primarily financed through four funding mechanisms (National Research Council, 1995):

(1) formula-based grants administered through USDA,

(2) special grants earmarked by Congress for specific

institutions and administered by USDA,

(3) competitive grants awarded and administered by

USDA, and

(4) cooperative agreements with USDA and other

Federal agencies.

While Federal sources constitute only 30 percent of

the 1862 land-grant universities’ total research funds,

Federal sources make up 87 percent of total funds for

research at the 1890s (table 6). Federal formula funds

constitute approximately 90 percent of the CSREESadministered research funds for 1890s, while the corresponding figure for 1862s is 44 percent. Non-Federal

sources contribute 19.5 percent of total research funds

at 1862s; private sources of research funds at 1890s

are very small (1 percent). State funding is the single

largest source of research funding for 1862s, accounting for 47 percent of funds, while States’ contribution

to research at 1890s is only 12 percent. State funding

of 1890s’ research will likely increase with passage of

the Agricultural Research, Extension, and Education

Reform Act of 1998, which requires States to match

50 percent of Federal formula funds for 1890s’

research and extension. 

Over the last four decades, the types of Federal funding to land-grant universities have changed, with a

decreasing share of research dollars awarded through

formula funds and an increasing share awarded

through competitive grants and special grant funds

(Huffman and Just, 1999). Moreover, the funding

bases for agricultural research have been shifting

recently away from public sources and toward private.

These developments put 1890s at a comparative disadvantage to 1862s, since most 1890 universities are

comparatively small and more dependent on Federal

formula funding than the 1862s. Thus, even small

changes in USDA funding for research play a much

larger role in the 1890s than in 1862s.

10 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

3During the same period, 44 percent of USDA's Capacity Building

Grants were for research projects.
Funding for Extension Programs

The 1890 extension service programs are funded

almost entirely by USDA through the Cooperative

Extension Service. The Smith-Lever Act established

the Cooperative Extension Service as a joint effort of

USDA and the land-grant institution in each State, and

also provided for county-level participation. The 1890s

were directed to work in cooperation with their 1862

counterparts to extend the benefits of the Cooperative

Extension System to their States’ Black populations

(USDA, 1988). This arrangement lasted until the mid1960s, when charges of discrimination brought a

reevaluation of the dual program.

Beginning in 1972, Congress provided direct funding

(as well as funding to be administered by each State’s

Cooperative Extension Service) to 1890 extension programs. Funds were provided under Smith-Lever section 3(d) from 1972 to 1978, and increased from $4

million in 1972 to $9.3 in 1978. The 1977 Food and

Agriculture Act eliminated the role of the Extension

Service in distributing funds to the 1890 Extension

program in those States with two land-grant colleges

(Godfrey and Franklin, 1992); since 1979, extension

formula funds have been made under section 1444 of

P.L. 95-113. These formula funds increased from

$10.1 million in 1979 to $26.8 million in 2000 (see

table 2). Extension facility construction grants were

also provided for extension facilities from 1988 to

1992 and for extension and research facilities since

1991 (USDA, 1994).

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 11

Table 6—Source of funds for research to 1890 and 1862 institutions, fiscal year 2000

Funding mechanism 1890s 1862s

$1,000 $1,000

Formula funding 28,311 (75.8%) 186,915 (7.9%)

Special research grants 714 (1.9%) 58,727 (2.5%)

Competitive research grants 0 (0%) 40,877 (1.7%)

Other CSREES 2,812 (7.5%) 34,472 (5.7%)

Other USDA 89 (.2%) 75,022 (3.2%)

Other Federal 512 (1.4%) 285,379 (12%)

State appropriations 4,548 (12.2%) 1,117,819 (47.4%)

Other non-Federal 370 (1%) 458,912 (19.5%)

Total 37,356 (100%) 2,258,123 (100%)

Source: USDA, Cooperative State Research, Education, and Extension Service.
Identifying Measurable

Administrative Indicators

It has been argued that through all three of their mission programs—teaching, research, and extension—

the 1890s build human capital in traditionally underserved areas (see, for example, Williams, 1973;

Brazziel, 1983; Parks, 1985; Williams and Williamson,

1985; Allen, 1990; Davis, 1992; Evans et al.; and

Polopolus, 1990). Yet, little measurable empirical evidence exists of the private or social benefits generated

by teaching, research, or extension activities of the

1890 universities. There has been no systematic effort

to measure the economic contribution of the 1890s’

programs to human capital development or to improving the well-being of the population they serve. 

In the parlance of some management systems, outcomes are benefits that accrue to individuals and society when people participate in a program. They may

take the form of enhanced learning (knowledge, perceptions/attitudes, or skills); increased income; or a

change in conditions, such as improved health, from

the adoption of a desired behavior or practice.

Indicators are measurable events accepted as evidence

that an outcome has been achieved. 

Contributions to social welfare made by educational

institutions are difficult to measure. For example, a

college or university may create an atmosphere that is

especially welcoming to minority students, thereby

encouraging some students to attend college who otherwise might not (LeBlanc, 1996). Usual indicators of

educational output such as test scores may not capture

such contributions. Similarly, not all R&D contributions may be captured by standard measures of

research output such as patent or publication counts.

Indicators that do not take these types of contributions

into account may underestimate total benefits. 

Teaching Outcomes and Indicators 

In 1993-94, the Historically Black Colleges and

Universities (HBCUs) awarded 28 percent of bachelor’s, 15 percent of master’s, 9 percent of doctorate,

and 16 percent of first-professional degrees to Blacks

in the United States (National Center for Education

Statistics, 1996). The 1890s institutions are a subset of

the HBCUs and play an important role in educating

African-Americans.

The 1890 land-grant universities account for a third of

all African-American students enrolled in HBCUs and

have played a significant role in training students from

various ethnic minorities in agricultural and food sciences, engineering, mathematics, and other disciplines.

In 1993 about 20 percent of minority students pursuing

bachelor’s degrees in agriculture and natural resources

specializations were enrolled at 1890 colleges

(National Research Council, 1995). Moreover in 1994,

16 percent of all African-American students enrolled

in U.S. institutions of higher education were enrolled

at 1890s. 

The 1890 land-grant institutions play a significant role

in educating minority students for professions in agriculture and related fields. During the 1970s, approximately 80 percent of the students enrolled in agriculture

at the 1890 institutions were non-White, compared with

only 5 percent at 1862 institutions (Hytche, 1992). In

the 1980s, the 1890 institutions accounted for about 35

percent of all minorities enrolled in agriculture-related

12 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Table 7—Administrative outcomes and indicators 

for teaching

Outcomes Indicators

Matriculation Numbers and proportions of:

·students who return to complete 

their degree program

·students graduating with different 

levels of degrees

·ethnic minorities graduated 

Employment Income earned by graduates

Numbers and proportions of:

·graduates employed in USDA

·graduates employed in agriculture

·graduates employed in their field

Professional/ Numbers and proportions of

leadership graduates:

achievement ·pursuing graduate or professional 

studies

·with advanced degrees in leadership

roles

·active in their professional and/or 

community organizations

·indicating education key to contributions as citizens and or in their 

professions

Personal Number and proportion of graduates

satisfaction who:

·return to the same institution at a 

higher program level 

·are active in alumni associations

·recruit and/or recommend others to 

their alma mater

·contribute financially to alma mater

Source: Essel, Clarke, and Tegene, 1999.
fields and graduated about 65 percent of AfricanAmerican recipients of bachelor’s degrees in agricultural sciences. The 1890 institutions continued to be a significant source of minority graduates in the 1990s.

The schools and colleges of agriculture, forestry, and

renewable natural resources at these institutions offer

both undergraduate and graduate degree programs.

Minority students in baccalaureate programs at these

schools and colleges specialize in a wide range of

areas, although many seem to find a few areas, such as

animal sciences and agricultural business and management, most attractive (see appendix tables B6-B7). 

The specific outcomes of teaching programs at the

schools/colleges of agriculture in the 1890 land-grant

institutions depend on the particular goals and objectives established for these programs by the institutions,

by State and Federal agencies funding the programs,

and by stakeholders. However, based on the fundamental objective of the 1890 land-grant teaching program—to prepare students to become productive citizens capable of reaching their full potential—the outcomes of USDA-supported 1890 teaching programs in

food and agricultural sciences could be measured by

the number of graduates who obtain degrees in food

and agricultural sciences; gain admission to

graduate/professional school; secure employment;

attain career/professional goals; and become leaders in

their professions, communities, country, and the world.

Each of these outcomes can be measured by a number

of indicators. For example, matriculation can be measured by the number and percent of students graduated

with different levels of degrees and/or the number and

percent of African-American and other ethnic minorities graduated. Outcomes are often multi-dimensional

and not easily represented by a single indicator. Table

7 provides some examples of potential outcomes and

indicators that might be used to measure the performance of 1890 institutions in the area of teaching.

Most outcomes and indicators should be compared to

graduates from similar programs in other institutions

and graduates from 1862 and non-land-grant institutions adjusted for regional and social differences.

Research Outcomes and Indicators 

Agricultural research at the 1890 institutions is facilitated by the Association of Research Directors, Inc.

(ARD), a federation of the research directors from the

seventeen 1890 land-grant universities that provides

coordination of research initiatives among member

institutions in cooperation with Federal, State, and private partners. ARD partners with USDA’s Cooperative

State Research, Education, and Extension Service

(CSREES) and holds membership in the State

Agricultural Experiment Station System (SAES) of the

National Association of State Universities and LandGrant Colleges (NASULGC). It also cooperates with

other regional, national, and international committees,

organizations, and groups in developing programs and

legislation affecting the food and agricultural research

needs of the Nation. 

Research priorities at 1890s are determined by Federal,

State, and local priorities and needs, which are heavily

influenced by stakeholders. However, the fundamental

food and agricultural research mission of the 1890s is to

ensure a safe, affordable, and ample food and fiber supply; to promote a sustainable environment; to conserve

natural resources; and to contribute to the improvement

in the socioeconomic well-being and overall quality of

life of diverse rural and urban populations (Mayberry,

1976; and Mayes, 1992).

The 1890s have developed research programs in animal science, crop science, natural resources, human

health and nutrition, and rural development. In addition, research at the 1890s has addressed the problems

and concerns pertinent to small-scale farmers and limited-resource families, including, for example, research

on minor livestock species, such as goats and rabbits,

that are particularly suited to small-farm operations. 

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 13

Table 8—1890s research expenditures by ESCOP1

Program areas, 2000

Research area $1,000 Percent

Environment and natural resources 6,171 16.5

Plant systems 8,975 24.0

Animal systems 9,241 24.7

Food and non-food products 2,129 5.7

Engineering 846 2.3

Economics, markets, and policy 2,544 6.8

Human nutrition and food safety 4,901 13.1

Family and community systems 1,628 4.4

Research support, administration 920 2.5

Total 37,355 100

1 Experiment Station Committee on Organization and Policy.

Sources: Cooperative State Research, Education, and Extension Service

(CSREES). Data based on USDA's Current Research Information 

System (CRIS).
Current primary research areas at 1890 institutions

include economically competitive and sustainable

small-scale production systems; improved plant, animal, and aquaculture production systems; crop diversity and alternative crops and marketing strategies for

farmers; food safety and quality; family and community development; protection and improvement of water

quality and quantity; environmental pollution and

waste management, value-added plant and animal

products, and improved nutrition and health (Mayes,

1992).

Apportioning credit for observed changes to research

conducted at specific institutions, or even to research

in general, is difficult. For example, how might one

partition the value of an increase in the agricultural

productivity in the United States among contributions

from 1862 land-grants, 1890 land-grants, and other

public and private research institutions? Particularly

for the 1890s, because research and development

expenditures are relatively small portions of total agricultural R&D expenditures in the United States, estimating a statistical relationship between agricultural

productivity or other advancements in the agricultural

sector and funding in these institutions becomes nearly

impossible. 

It may be difficult to estimate the contribution of

1890s to changes like overall productivity growth, but

each institution’s output or research outcome can be

identified. In one approach, the Experiment Station

Committee on Organization and Policy (ESCOP) has

designed 9 general areas to identify research outcomes: environment and natural resources; plant systems; animal systems; food and non-food products;

engineering; economics, markets, and policy; human

nutrition and food safety; family and community systems; and research support and administration. Since

1890s spend about 65 percent of their research funds

in the areas of animal/plant systems and environmental

and natural resources research (table 8), outcomes in

these research areas are particularly important. 

Within these broad categories of research, potential

outcomes include new understanding of efficient use

of land and water resources with environmentally

friendly farming practices; new information on healthy

and optimal nutritional requirements of individuals and

knowledge of enhanced food safety measures; new

and/or improved byproducts; new knowledge of effective strategies for strengthening communities and

improving quality of life for rural communities; new

information on profitable use of feed grains, pasture,

forage, and other crop byproducts for producing minor

livestock species particularly suitable for small farmers; improved quality of animal production systems

and animal food products; and knowledge of new and

cost-effective techniques for plant breeding, sustained

productivity of plants, and improved plant management systems.

Traditional indicators of research outcomes depend

heavily on publication and/or patent counts. Common

indicators of research outcomes include the number of

products/patents produced; number of journal articles,

books, and monographs published; number of research

reports, staff papers, or working papers written; number of conference papers presented; number of copyright notices filed; and/or number of refereed journal

articles identified in citation indexes.

Extension Outcomes and Indicators

The Cooperative Extension Service is an outreach 

and education program designed to enable people to

improve their lives through scientific knowledge adapted and applied to their everyday issues and needs

(National Research Council, 1995: p. 68). The impetus

for the Federal extension initiative stemmed from concerns in the early 1900s that knowledge and technologies being developed at the State agricultural experiment stations and USDA were not reaching those

farmers and citizens not enrolled in the land-grant colleges. Congress addressed these concerns with the passage of the Smith-Lever Act of 1914 that established

the Extension Service as a cooperative effort among

Federal, State, and county governments on a nationwide basis.

The 1890 universities began their outreach program for

Black farmers shortly after the universities’ establishment. The “farmers conference” in 1892 and the “short

course in Agriculture” offered by Tuskegee (and soon

followed by other 1890s) are considered to be the

beginning of Black agricultural extension work

(Neyland, 1990, p. 149-151). As early as 1906,

Tuskegee’s “movable school” or “traveling school”

taught Black farmers better ways of farming by using

field demonstrations, a model soon adapted for use

across the Cooperative Extension System. Today, the

1890 extension system is part of a nationwide

Cooperative Extension System that encompasses the

land-grant universities, the U.S. Department of

Agriculture, and county governments. 

14 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA
The 1890 institutions have targeted their extension

programs toward limited-resource and underserved

populations. Historically, these audiences lacked

access to other non-formal educational opportunities

because they were hard to reach; had distinct problems

associated with their poverty, minority status, and scale

of farming; and presented little or no economic incentives to private sector suppliers. In 1998, the

Association of Extension Administrators (AEA) published a strategic plan to guide extension work at the

1890 institutions in the 21st century. In this plan, the

AEA identified the special mission of the 1890

Extension System as assisting “diverse audiences, with

emphasis on those who have limited social and economic resources, to improve their access to positive

opportunities through outreach education.”

Extension programs commonly focus on seven base

areas (National Research Council, 1995): agricultural

competitiveness and profitability, community resource

and economic development, family development and

resource management, 4-H and youth development,

leadership and volunteer development, natural

resource and environmental management, and nutrition, diet and health.

The customer needs of each State determine the areas

of each land-grant institution’s educational priorities,

but many 1890 institutions offer extension programs in

most of these areas. For each area, institutions develop

program plans that identify goals and objectives,

including activities needed to achieve them. Ideally,

for each objective, the program plan defines outcomes

desired, indicators for measuring these outcomes, and

evaluation methods that may be used to gather information.

Extension programs help a target audience find solutions to a defined problem in a systematic and sequential educational process. They create opportunities for

people or communities with a problem to progress

from awareness to increased knowledge and skills to

adoption of a desired behavior. To meet the educational mandates of stakeholders and funding sources,

extension programs must establish goals and objectives

that stimulate outcomes which ultimately result in a

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 15

Table 9—Extension outcomes and indicators 

Outcomes Indicators

Farmers make decisions that enhance profitability. Number of informal small-farm profitability and sustainability education programs conducted, number of producers and landowners

participating in non-formal educational program, and number of 

producers adopting recommended farm business management 

practices such as strategic planning and risk management.

Farmers adopt production practices that enhance income, Number of producers adopting production practices and alternaenvironmental quality, and their communities. tives that are profitable and promote quality of soil, water, and air 

resources; number of farmers adopting new and value-added 

enterprises; number of farmers adopting cost-saving practices;

and number of farmers developing and implementing marketing 

plans. Dollar value of new and value-added products produced, 

savings from adopting improved management practices, and

additional income from farming.

Households have increased knowledge of family resource Number of childcare providers receiving training, number/percent

management and childcare providers improve the quality of participating childcare providers adopting recommended quality

of care given to children. childcare practices, number of participants starting new childcare 

business as a result of training, number of people participating in 

household resources/financial management program, and dollars 

saved by adopting the new resource/financial management 

strategies.

Farmers are more knowledgeable about government, Number of participants in the community leadership programs, 

education, strategic planning, and their communities. number of participants who serve (attend) and/or plan to serve 

(attend) community activities such as school board, governing 

board, or planning commission board in their community, number 

of participants who are appointed to leadership roles at all levels 

of the community, and number of participants who report 

increased knowledge and understanding of the economic 

development plan for their community.

Source: Essel, Clarke, and Tegene, 1999.
desired personal and societal change. These outcomes

may include improved quality of life for individuals

and families, more productive farms and forests, and

enhanced environmental conditions in urban and rural

communities.

Determining the value of extension programs will

require the collection of quantitative and qualitative

data on outcomes and indicators. Rennekamp, Warren,

and Maurer (1996) have listed seven levels of data that

can be collected about outcomes of an Extension program, in order of their usefulness in documenting outcomes. These levels are changes in social, economic,

or environmental conditions; things participants are

doing differently as a result of the program; changes in

knowledge, opinions, skills, or aspirations; participants’ feeling about the program; number of people

who participated in the program; what was done and

the interactions of the participant with the educator;

and resources expended for the program. The highest

levels reflect changes in participant behavior and

social impacts. However, as noted by the Greater

Kalamazoo Evaluation Project (Spring 1998), measuring behavioral changes of program participants poses

serious challenges. At best, any such behavioral outcome measurements are only approximations.

In the past, the Extension Service has been effective in

documenting and reporting program inputs, activities,

and outputs (number of people participating, number

of workshops and meetings held, number of educational materials distributed, number of hours of volunteer

service delivered, etc.), but have been less effective in

documenting outcomes. With increased demands for

accountability from governments, other funding agencies, clients, and stakeholders, Extension is challenged

to develop meaningful outcomes and measures for its

programs that allow for adequate determination of

their effectiveness and returns on public investments

(National Research Council, 1996).

Valuing the economic benefits of 1890 extension programs will require collecting data on inputs, activities,

outputs, and outcomes of all the different outreach and

educational programs offered by the 17 institutions

that comprise the 1890 Extension System. Rennekamp,

Warren, and Maurer (1996) provide a detailed description of some of the methods and approaches that can

be used in gathering such data.

Because quantitative data are easier and more amenable

to mathematical analysis, program planners and evaluators tend to prefer to obtain such data for measuring

educational impacts. For example, the number of people affected by an extension program is usually used as

a gauge for the program’s effectiveness. Unfortunately,

this method often leaves out qualitative impact information. In addition, it may not necessarily provide a

good guide in determining which projects are having

the largest impacts. A program that affects 100 people

significantly (however significance is measured) may

be a better use of funds than a program that affects

1,000 people only slightly. Just focusing on quantitative

data and modeling may fail to capture the greatest outcomes that extension programs can have on people’s

quality of life. Although qualitative measures are

imprecise and difficult to evaluate economically, valuing the return on investment in 1890 extension programs must inevitably include a qualitative component. 

16 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA
Exploring Conceptual

Frameworks

Attempts to evaluate the impacts of these institutions

may consider various types of outputs, but the educational mission has probably generated the greatest

returns. Because education is embedded in the individuals who receive it, economists often refer to educational investments as generating human capital

(Becker, 1980). Human capital, like other forms of

capital, provides a service that pays off over a period

of time. And, it is the product of deliberate investment

decisions, both public and private. In the next sections,

we focus on the role of the 1890s in developing human

capital. We discuss how economists conceptualize the

link between resources that flow into human capital

development and benefits that flow out. We also indicate what might be involved in estimating the net economic benefits from human capital development at the

1890 institutions. 

Human Capital Theory

The concept of human capital has been around for centuries. However, about 40 years ago, the study of

human capital increased, in part due to the realization

that growth in physical capital explains a relatively

small part of income growth in most countries. The

search for better explanations of income growth led to

improved measures of physical capital as well as to

interest in technological change and in human capital

and its measurement (Becker, 1980).4

The incentive for acquiring human capital through a

college education is based largely on technological and

other changes in the economy. If technology and the

economy as a whole were to remain stagnant, incentives for higher education would be minimal.

Education increases society’s ability to adjust to ramifications of technological and economic change by

helping people figure out how to allocate resources

better given the new environment (Huffman, 1977;

Schultz, 1975; and Welch, 1970). If they allocate better, they are more productive and efficient, and

incomes rise. Students expect to capture the value of

their productivity gain in the form of higher wages. Of

course, education can also help people make better

consumption decisions and improve their productivity

in home production, child rearing, and other ways that

benefit the individual and society (Michael, 1972).

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 17

Table 10—Percent of White college-graduate earnings earned by Black, Latino,

and Asian-American college graduates

Category 1939 1949 1959 1969 1973 1979 1982 1989

Percent

Male:

Black 59 72 67 68 90 82 81 70

Latino 61 66 78 76 97 88 90 83

Asian-American 73 85 85 110 -- 91 -- 100

Female:

Black 67 89 71 101 97 95 92 94

Latino -- -- -- 99 102 94 97 98

Asian-American -- -- -- 104 -- 110 -- 106

Source: Carnoy, 1995.

Table 11—Private rates of return to college education 

Category 1939 1949 1959 1969 1973 1979 1982 1987

Percent 

White male 10.9 9.1 10.4 10.8 8.6 9.5 9.8 11.0

Black male 5.7 5.8 6.1 10.2 9.8 8.6 8.5 12.7

Latino male 7.2 7.1 8.6 7.9 10.2 8.7 11.7 12.2

Source: Carnoy, 1995.

4Much of the conceptual work on the value of human capital was

contributed to or stimulated by economists T. W. Schultz and Gary

Becker (Schultz, 1961, 1971, 1975; Becker, 1962, 1980, among

many other papers and books). A large literature of empirical studies has followed (e.g., Hansen, 1963; Hanoch, 1967; Welch, 1973,

1975; Cain, 1976; Huffman, 1977; Psacharopoulos, 1981;

McMahon, 1991; Cohn and Hughes, 1994). 
And as an economy grows, the value of human time

increases, increasing the value of human capital and

stimulating demand for it in many forms. 

Demand for less discrimination in access to schooling

and higher education may also increase with economic

growth. Discrimination in education and in the workplace reduces the returns to education, both for the

individual and for society, and retards economic

growth. Evidence indicates that returns to schooling

during the first half of this century were significantly

less for Blacks than for Whites and were also less for

Blacks than they are today (Becker, 1980; Welch,

1973; and Carnoy, 1995), although Black male college

graduates still earn significantly less than White,

Latino, or Asian-American graduates (see table 10).

Similarly, historical discrimination in education and

extension service available to Black farmers hindered

their productivity. Huffman (1981), using 1964 data

from southern States, showed that Black farmers in the

U.S. South obtained lower quality and fewer years of

schooling than White farmers, and that the extension

services provided to Black farmers were fewer and of

lower quality than those provided to White farmers. He

estimated an econometric model that identified the

quantity and quality of Black farmers’ education and

extension services as the primary source of their lower

productivity relative to White farmers. Huffman (1981)

concluded that this lower productivity contributed to

the exodus of Black farmers from southern agriculture

at double the rate of White farmers during the 1950s

and 1960s, when agricultural technology was changing

rapidly.

Many empirical studies provide estimates of economic

rates of return to schooling, including higher education, and some disaggregate those rates by gender and

race (e.g., Psacharopoulos, 1994; Constantine, 1995;

and Carnoy, 1995). The rates vary over time with the

health of the economy and as structural changes

increased job access for minorities and women.

Estimated rates of return to a college education have

averaged from 9 to 15 percent with a dip in the 1970s

(Cohn and Hughes, 1994; Carnoy, 1995; and table 10).

Rates of return to a college education for the AfricanAmerican population were lower than those for the

White population for several years (see table 10); job

discrimination (Becker, 1980) and lower quality of

education (Card and Krueger, 1992b) may have led to

lower earnings of Black graduates.5

The rates of return to non-White male graduates were

in the 6-10-percent range just before U.S. entry into

World War II, depending on location, compared to 10-

12 percent for white males. These lower rates of return

prevailed despite lower forgone earnings (income students might have earned had they been working rather

than attending college) of Blacks while they attended

college. Even at 6-10 percent, however, college was a

good investment for Blacks. By the mid-1980s, it

appears that racial differences in rates of return to a

college education had essentially disappeared (Carnoy,

1995 and table 11). Although earnings after college

remained lower for Blacks than for Whites, the costs

of attending college remained lower also, especially

the forgone earnings. 

Measuring the Returns to Human Capital

How rates of return to college education are calculated

is relevant for estimating impacts of the 1890 institutions. When economists refer to an expenditure on

higher education as an investment in human capital,

they are implying it is possible to measure a return on

this investment. The return is based on the future

income streams generated by the capital, compared to

the costs of acquiring it. Cost-benefit techniques can

be used to make this comparison, taking into account

that costs and benefits occur during different time periods. The typical pattern of earnings for college versus

high school graduates is illustrated in figure 4. College

graduates receive earnings lower than high school

graduates while in college, but receive higher wages

when they are older.

Investment in human capital provides net returns to the

individual and to society. Individuals benefit from

increased lifetime earnings. Earnings after taxes, with

and without the education, can be compared with

direct and indirect costs of the education borne by the

individual. Direct costs include tuition, fees, books,

supplies, unusual transportation and lodging costs, and

other expenses, while indirect costs include primarily

the income forgone while going to school. As indicated in figure 4, even if a student works while in school,

his or her earnings are usually less than if he or she

were not in school.

18 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

5Card and Krueger (1992a) found that people educated in States

with high-quality schools (as measured by student-teacher ratio,

average term length, and the relative pay of teachers) exhibit higher returns to additional years of schooling. In another paper, Card

and Krueger (1992b) found that improvements in the quality of

education Blacks receive explain 20 percent of the narrowing of

the Black-White earnings gap during 1960-80.
Society benefits from the increased productivity of the

worker. Therefore, society typically bears some of the

costs of the investment through subsidized tuition or

other means. By accounting for these costs, and by

measuring earnings differentials before taxes as well as

forgone earnings (before taxes) while in college, an

estimate of the social rate of return can be obtained

through social cost-benefit analysis. However, some of

the benefits to society remain outside this analysis,

leaving the estimated returns likely an underestimate

of total gains from education.

An alternative way to measure the social rate of return

to human capital investments related to education is to

estimate a model that relates productivity changes in a

country (or to a particular sector such as agriculture) to

changes in land, labor, capital, and education.6 Education might be measured by a variable such as years

of schooling. Such models have been estimated both in

the United States and in several other countries (see

Welch, 1970, for a classic paper related to U.S. agriculture). The difficulty in using this approach for estimating returns to investments in the 1890 universities,

however, is that their educational programs have relatively small impacts on the economy or on the agricultural sector (compared to the impacts of higher education as a whole), making their impacts hard to detect

empirically.

A human capital approach that focuses on earnings

gaps between 1890 graduates and high school graduates is likely to be more fruitful. However, several

issues must be addressed in any meaningful attempt to

apply such an approach to measuring human capital

benefits of the 1890s. First, the models used must be

structured to disentangle the effects of inherent ability,

other personal characteristics, and job location from

the effects of an 1890 education, an issue of concern

for any attempt to estimate the value of higher education. A statistical analysis that accounts for the various

factors influencing earnings gaps could handle this

problem.

A second issue more specific to the 1890s is the need to

capture how the returns have changed over time as the

degree of discrimination in labor markets has changed.

As noted earlier, several studies have found lower

returns to education of African-Americans for earlier

periods when labor markets were more severely segmented into Black and White than they are today

(Becker, 1980; Hanock, 1967; and Welch, 1973),

although forgone income while going to college was

also low for Blacks in earlier periods. Unless a student

prepared for a profession such as medicine or law and

subsequently served the African-American community,

wage differentials due to a college education were small

simply because many jobs that brought returns to

greater education were not available to AfricanAmericans, especially in the South. This problem might

be handled by measuring only the value of an 1890 education over a more recent period, during which discrimination in the labor market is less pronounced. 

A third issue, again more specific to the 1890s, is

whether their particular contribution to education is

creating a welcoming atmosphere for minority students

that encourages students to attend college who otherwise might not. If this contribution is significant, the

analyst must decide whether the relevant comparison

for measuring the benefits of an 1890 degree is to

other colleges attended by Black students, or to benefits of a high school diploma only. Because continued

availability of 1890s may be most important for their

ability to increase the total number of minority students attending college, the most appropriate comparison may be between an 1890 degree and a high school

diploma. 

A fourth issue concerns the availability of data sources

for estimating a human capital model for the 1890

institutions. Data sets are available that contain information on earnings, level of education, personal charEconomic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 19

Age

Earnings

High school

College

Figure 4

Earnings profiles for college versus high 

school graduates

Source: Norton and Tegene (1999).

6 Likewise, education can be included as a variable in a model that

assesses its impact on household productivity or consumption efficiency (see, for example, Michael, 1972).
acteristics, and other variables needed for estimating

the overall value of higher education as a form of

human capital. While these data sets are disaggregated

by race, they usually do not include the college attended. It may be necessary to survey 1890 graduates in

order to complete an empirical evaluation. The issue

will then be whether to survey a comparison group or

whether to rely on census data to create that group. 

This combination of issues has implications for the

human capital models and data needed to effectively

evaluate the 1890s as human capital “producers.” More

details of an empirical model that might be used to

accomplish this task are presented in appendix A.

Returns to Research and Extension 

While education is the primary activity of the 1890

land-grant universities, these institutions undertake significant research and extension (R&E) activities with

potentially measurable impacts. Economic benefits of

investments in research and extension are often estimated by using one of two approaches: economic surplus analysis and production function estimation (see

for example, Fuglie et al., 1996 and Alston et al.,

1998). 

Economic surplus analysis incorporates estimated

demand and supply elasticities and changes in productivity that can be attributed to R&E to estimate the

benefit of research and extension to consumers and

producers (consumers’ and producers’ surplus). To

obtain an estimate of rate of return, the changes in

consumer and producer benefits are compared to the

cost of the research. This approach is most often used

for individual innovations or individual commodities

for which the productivity change can be easily attributed to specific research funding (Fuglie et al., 1996).

The contribution to productivity change of a specific

institution or group of institutions is more difficult to

identify.

Production function estimation relies on statistical estimation of a production function that contains expenditure on research and/or extension as explanatory variable(s). With this method, productivity growth is related to past investment in R&E and other variables, and

an attempt is made to estimate econometrically the

part of total output or total factor productivity growth

that can be attributed to research and extension.

Because R&E at 1890s is a relatively small portion of

total agricultural R&E in the United States, it is difficult to estimate a statistical relationship between, for

example, agricultural productivity change and funding

at these institutions. Of the $6.3 billion expenditure on

agricultural research by Federal and State governments

and the private sector in 1992 (Fuglie et al., 1996),

expenditure on the1890s’ R&E was less than 1 percent

($51.1 million) (USDA, 1994).

Given the limitations of the two standard approaches, a

better way to estimate economic impacts of R&E at

the1890s is to conduct case studies. The case studies

would conduct a benefit-cost analysis of a sampling of

programs or projects. The sample could either be random or based on a selection of particularly successful

programs or projects. Focusing on successful projects

often makes sense when it appears that a few projects

have impacts so substantial that they more than pay for

the funds invested in the entire program. Market data

and expert opinion on the effects of projects on yield

or costs, adoption of results, and other factors can be

used in the benefit-cost analysis. Adequately capturing

non-market benefits, such as to the environment and

health, can be difficult, particularly for limitedresource farmers, but estimates are possible. 

20 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA
Next Steps for the Partnership

The 1890 land-grant universities have developed teaching, research, and extension programs that reach historically underserved students and communities.

Research and extension programs address issues of

special interest to minority rural communities and

small-scale and limited-resource farm operators, as

well as a range of more traditional topics reflecting the

expertise and interests of the 1890 faculty and graduate students. 

The collaboration reflected in this report explored the

best ways to measure returns to investments in teaching, research, and extension programs, with the ultimate goal of improving the effectiveness of these

investments. This report focused on the core questions

of how 1890 institutions have been funded, what are

the best indicators by which to measure program outcomes, and how to develop conceptual models for estimating future returns to investments. Further research

will continue work on identifying the most reliable

measures of outcomes and on assessing the adaptability of available conceptual models to the particular

parameters of the 1890 programs. Research will also

begin on case studies of individual 1890 programs to

explore methods of assessing program outcomes using

a combination of measurable, quantitative indicators

and qualitative data gathered through interviews and

observation. 

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 21
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24 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA
The human capital model that may be used will have

components that (1) capture the time patterns of earnings and costs, with and without college, to take into

account that earnings that come earlier are worth more

than earnings that come later, and (2) account for factors unrelated to a college degree that may be causing

part of the earnings differential, such as age, experience, location, gender, and race. The data will need to

indicate not only whether individuals graduated from

college or not and their race, but also whether the college was an 1890.

The following is a slightly modified version of the

human capital approach employed by Cohn and

Hughes (1994). Several steps are involved to control

for earnings differences for high school versus college

graduates that are related to non-college sources such

as native ability, location, and personal characteristics.

The first step is to account for differences in the college and high school groups using a self-selection

technique such as the Heckman (1979) procedure.

Probability of college attendance is estimated using a

probit equation of the form:

CD=f(Z) (1)

where CD is a zero-one variable that indicates whether

or not the individual has a college degree, and Z is a

vector of variables that is expected to influence college

attendance (such as education of the father and mother,

one- versus two-parent family, number of siblings,

location, rural/small town/big city, race, and economic

conditions at the time of college decision). The equation is estimated with maximum likelihood (ML). The

following earnings equation is then estimated, first for

high school graduates and then for college graduates:

ln Y = a + b1A + b2A2 + c1T + c2T2 + 

∑di

Xi + e (2)

where Y represents hourly earnings, A = age, T =

tenure in employment, and X is a vector of relevant

labor-market and personal characteristics such as marital status, location, race, and sex. The coefficients a, b,

c, and d are scalars and e is a random error term. The

X vector also includes a “selectivity” variable, LAMBDA, which is derived from the ML estimation of equation 1 using the inverse of Mill’s ratio. After this estimation, in order to take account of the differences

between the X vectors of the two groups in one time

period, as well as differences in the X vectors over

time, the means of the attributes of the college graduates for one time period are substituted for the X vector for all years and for both college and high school

graduates. Let

B = a + ∑d i X (3) 

where a is taken from the estimates of equations 2.

Then substitute B into equations 2.

lnY = B + b1A + b2A2 + c1T + c2T2 (4)

Because age and tenure are correlated, it is necessary

to estimate the age-related values of tenure. A regression of age on tenure (T = f(A)) is estimated, and the

estimated f(A) is substituted for T in equation 4. After

this substitution, lnY is a function of A only. Age earnings profiles are then calculated on the basis of equation 4 for each age. Next, the adjusted earnings (E) are

obtained using equation 5 as follows:

E = [Exp(lnY)] * H (5)

where H is the number of hours worked per week

(which might be assumed to be 2,000 for 40 hours per

week for 50 weeks, or it could be based on actual data

for high school and college graduates). The next step

is to use ordinary least squares to derive age earnings

profiles separately for college and high school graduates using an equation such as:

E = f + g A + h A2 + v (6)

where f, g, and h are partial regression coefficients and

v is a random error term. The two age-earnings profiles provide estimates of Ect for college graduates and

Eht for high school graduates, to be used in estimating

a rate of return to education. The following equation is

used to estimate that rate of return:

∑ t = 1...n (Ect - Eht - Ct

)/(1 + r)t = 0 (7)

where Ct are the direct costs of college education at

age t and r is the internal rate of return.

Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 25

Appendix A—Human Capital Model
26 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Appendix table B1—Student enrollment in 1890 land-grant universities, fall 1990-98

1990 1992 1994 1998

Alabama A&M University 4,886 5,068 5,543 5,128

Alcorn State University 2,863 2,919 2,742 2,847

University of Arkansas-Pine Bluff 3,672 3,709 3,823 3,069

Delaware State College 2,606 2,936 3,381 3,320

Florida A&M University 8,344 9,487 10,084 11,956

Fort Valley State College 2,158 2,537 2,823 2,847

Kentucky State University 2,506 2,541 2,563 2,299

Langston University 2,792 3,315 3,408 4,012

Lincoln University 3,619 4,030 3,512 3,214

University of Maryland-Eastern Shore 2,067 2,430 2,925 3,305

North Carolina State College 6,595 7,723 8,136 7,354

Prairie View A&M University 4,990 5,660 5,849 5,995

South Carolina State College 4,822 5,071 4,693 4,657

Southern University 8,941 10,403 9,904 9,567

Tennessee State University 7,393 7,591 8,180 8,750

Tuskegee University 3,510 3,598 3,322 3,090

Virginia State University 3,988 4,435 4,007 4,272

Total 75,752 83,453 84,895 85,682

Sources: National Center for Education Statistics (NCES) and 1890 Land-Grant System, Strategic Plan.

Appendix table B2—Student enrollment in 1890 land-grant universities, 1998-99

Undergraduate Graduate Total

Alabama A&M University 3,903 1,225 5,128

Alcorn State University 2,533 314 2,847

University of Arkansas-Pine Bluff 3,004 65 3,069

Delaware State College 3,057 263 3,320

Florida A&M University 10,711 1,245 11,956

Fort Valley State College 2,407 440 2,847

Kentucky State University 2,203 96 2,299

Langston University 3,969 43 4,012

Lincoln University 2,959 255 3,214

University of Maryland-Eastern Shore 2,984 321 3,305

North Carolina State College 6,367 987 7,354

Prairie View A&M University 4,738 1,257 5,995

South Carolina State College 3,875 782 4,657

Southern University 8,023 1,544 9,567

Tennessee State University 7,021 1,729 8,750

Tuskegee University 2,932 158 3,090

Virginia State University 3,341 931 4,272

Total 74,027 11,655 85,682

Source: 1890 Land-Grant System, Strategic Plan.

Appendix B—Tables
Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 27

Appendix table B3—Number of students graduated by 1890 land-grant universities, fall and spring 1997-98

Undergraduate Graduate Total

Alabama A&M University 544 375 919

Alcorn State University 523 212 735

University of Arkansas-Pine Bluff 371 9 380

Delaware State College 409 101 510

Florida A&M University 1,450 821 2,271

Fort Valley State College 557 289 846

Kentucky State University 328 25 353

Langston University 558 9 567

Lincoln University 456 92 548

University of Maryland-Eastern Shore 415 76 491

North Carolina State College 2,075 2,215 4,290

Prairie View A&M University 720 357 1,077

South Carolina State College 561 256 817

Southern University 948 274 1,222

Tennessee State University 822 260 1,082

Tuskegee University 416 101 517

Virginia State University 421 126 547

Total 11,574 5,598 17,172

Source: 1890 Land-Grant System, Strategic Plan.

Appendix table B4—Summary of minority baccalaureate enrollment in colleges of agriculture, renewable

natural resources and forestry classified by academic area in 1890 land-grant institutions, 1993-96

1993 1994 1995 1996

Academic area (n=13) (n=12) (n=13) (n=15)

General Agriculture 95 185 176 180

Animal Sciences 422 384 390 508

Plant Sciences 106 55 87 69

Horticultural Sciences 12 23 20 55

Soil Sciences 33 34 41 55

Agricultural Business & Management 561 549 426 489

Education, Comm., Social Sci. 92 61 94 85

Natural Resources 98 73 79 124

Forest Sciences 131 109 89 153

Ag. Eng./Mechanization 0 24 21 30

Food Sciences/Human Nutrition 42 38 45 94

Related Biological/Physical Sci. 0 0 173 184

Total 1,592 1,535 1,641 2,026

Nonagricultural programs 147 300 640 732

Total (all programs) 1,739 1,835 2,281 2,758

Note: n denotes the number of institutions reporting for the indicated year.

Source: Food and Agricultural Education Information System (FAEIS).
28 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Appendix table B5—Master’s student enrollment in 1890 land-grant colleges of agriculture, renewable natural resources, and forestry classified by academic area, ethnicity, and citizenship, fall 1998

African- Native Foreign Master’s

Academic area American Hispanic American Caucasian students total

General Agriculture 0 0 0 0 0 0

Animal Sciences 6 0 0 1 1 8

Plant Sciences 18 1 0 4 3 26

Horticultural Sciences 0 0 0 0 0 0

Soil Sciences 12 0 0 0 0 12

Agricultural Business & Mgmt. 23 0 1 5 10 39

Educ., Comm., Social Sci. 15 0 0 17 0 32

Natural Resources 20 0 1 33 3 57

Forest Sciences 0 0 0 0 0 0

Ag. Eng. Mechanization 0 0 0 0 0 0

Food Sciences/Human Nutrition 13 0 0 3 7 23

Related Biological/Physical Sci. 13 0 0 1 3 17

Total 120 1 2 64 27 214

Nonagricultural Programs 27 0 0 2 2 31

Total (all programs) 147 1 2 66 29 245

Note: Data represent only 8 of the 1890 land-grant institutions.

Source: Food and Agricultural Education Information System (FAEIS).
Economic Research Service/USDA Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 ❖ 29 Appendix table B6

—Fall 1998 graduate and undergraduate enrollment in 1890 land-grant colleges of agriculture, 

resources, and forestry classified by level, gender, and academic area

Enrollment report by program area and level

Forestry Natural Resources Agricultural Sciences Non-Ag Program

Region

& Institution 2 year Bac. Mas. Ph.D. 2 year Bac. Mas. Ph.D. 2 year Bac. Mas. Ph.D. 2 year Bac. Mas. North Central:

Lincoln University 0 0 0 0 0 0 0 0 0 125 0 0 0 3 0 

North Eastern:

Delaware State 

University 0 0 0 0 0 31 0 0 0 86 0 0 0 25 0 

U. of MarylandEastern Shore 0 0 0 0 0 50 10 17 0 84 21 0 0 125 0 

Southern:

Alabama A&M 

University 0 53 0 0 0 57 0 0 0 139 69 33 0 124 31 

U of Arkansas 

at Pine Bluff 0 0 0 0 0 23 2 0 0 89 5 0 0 121 0 

South Carolina

State University 0 0 0 0 0 0 0 0 0 59 10 0 0 0 0 

Fort Valley

State University 0 0 0 0 0 0 0 0 10 127 0 0 0 0 0 

Tuskegee 

University 0 7 0 0 0 19 15 0 0 495 52 0 0 0 0 

Total (All reporting 

institutions) 0 60 0 0 0 180 27 17 10 1,204 157 33 0 398 31 

Source: Food and Agricultural Education Information System (FAEIS).
30 ❖ Investing in People: Assessing the Economic Benefits of 1890 Institutions / MP-1583 Economic Research Service/USDA

Appendix table B7—Fall 1998 graduate and undergraduate enrollment in 1890 land-grant colleges of 

agriculture, renewable natural resources, and forestry classified by level, gender, and academic area

Baccalaureate Masters Doctoral

Academic area Male Female Total Male Female Total Male Female Total

General Agriculture 157 99 256 0 0 0 0 0 0

Animal Science 103 194 297 6 20 8 0 0 0

Plant Sciences 11 13 24 17 9 26 11 2 13

Horticultural Sciences 10 1 11 0 0 0 0 0 0

Soil Sciences 13 2 15 7 5 12 8 2 10

Agricultural Business

& Mgmt. 119 66 185 22 17 39 0 0 0

Education Comm.

& Social Sci. 31 12 43 29 3 32 0 0 0

Natural Resources 97 83 180 22 35 57 12 5 17

Forest Sciences 47 13 60 0 0 0 0 0 0

Agricultural Engineering/

Mechanization 14 0 14 0 0 0 0 0 0

Food Science/Human

Nutrition 8 40 48 14 0 23 3 7 10

Related Biological/

Physical Sci. 77 234 311 11 0 17 0 0 0

Total 687 757 1,444 128 89 214 34 16 50

Nonagricultural programs 66 342 408 20 11 31 0 0 0

Total (all areas) 753 1,099 1852 148 100 245 34 16 50

Source: Food and Agriculture Education Information System (FAEIS).