Book excerpt: "One of the striking ways in which state governments have pursued better performance in public higher education is through the use of performance funding. Performance funding involves tying state support directly to institutional performance on specific outcomes such as rates of graduation and job placement. The principal rationale for performance funding has been that the introduction of market-like forces will prod institutions to become more efficient, delivering "more bang for the buck." Kevin Dougherty, an expert on state performance funding, finds its development puzzling. First, despite the great interest in it, only half the states have ever adopted performance funding for higher education. Moreover, of the states that did adopt performance funding, over half later dropped it. Finally, in the states that have retained performance funding over a long period of time, their programs have undergone considerable changes in the amount of state funding they devote to performance funding and in the content of the indicators they use to allocate that funding. In spite of this, performance funding continues to attract interest as a way of improving educational outcomes. This book, based on an extensive ten-state study, aims to shed light on the social and political factors affecting the origins, evolution, and demise of these programs"--