TY  - JOUR
AU  - Lerner,Josh
AU  - Schoar,Antoinette
AU  - Wang,Jialan
TI  - Secrets of the Academy: The Drivers of University Endowment Success
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 14341
PY  - 2008
Y2  - September 2008
UR  - http://www.nber.org/papers/w14341
L1  - http://www.nber.org/papers/w14341.pdf
N1  - Author contact info:
Josh Lerner
Harvard Business School
Rock Center 214
Boston, MA 02163
Tel: 617/495-6065
Fax: 617/496-7357
E-Mail: jlerner@hbs.edu

Antoinette Schoar
MIT Sloan School of Management
100 Main Street, E62-638
Cambridge, MA  02142
Tel: 617/253-3763
Fax: 617/258-6855
E-Mail: aschoar@mit.edu

Jialan Wang
Olin Business School
Washington University in St. Louis
208 Simon Hall
1 Olympian Way
St. Louis, MO, 63130
E-Mail: jialan.wang@wustl.edu
AB  - In recent years, university endowments have received much attention for their spectacular returns and innovative investment strategies, but few papers have examined trends in the endowment sector at large.  In this paper, we analyze a sample of 1,300 educational endowments between 1992 and 2005.  A striking phenomenon emerges of the "rich getting richer", a dramatic widening of the size gap between the largest endowments, led by the Ivy League, and the average endowment.  Growth in endowment size has been driven largely by high investment returns, which are in turn related to the quality of the student body and the use of alternative assets.  Elite endowments seem to benefit not only from economies of scale in investment management, but genuine skill and expertise in choosing the right investments at the right times.
ER  -