Dollars and Degrees: The Asymmetric Impact of State Appropriations on STEM and Non-STEM Fields

Abstract This study examines the differential impact of state appropriations on science, technology, engineering, and mathematics (STEM) and non-STEM degree completion at U.S. public four-year institutions. Using a panel dataset from 2003 to 2019 and a Bartik-style instrumental variables approach, I find that state funding disproportionately affects STEM degree completion, with little to no impact on non-STEM degrees. A 10% increase in state appropriations leads to a 3.4% increase in STEM degrees conferred, primarily four years after the funding change. This effect is concentrated among male students, science STEM majors, and non-selective institutions. Increased state support leads to higher institutional spending and more STEM programs-factors that affect STEM degree completion more than non-STEM fields.