Trust-Based Philanthropy and Mission-related Outcomes of HBCUs: Estimating the Effects of MacKenzie Scott’s Yield Giving Grants

• In Event: Do Policy Levers Close Racial Gaps? Evidence Across Wealth, Taxation, and Higher Education

Abstract

HBCUs have long served as critical institutions for advancing educational equity by expanding opportunity for African Americans and other marginalized communities. At the same time, they have faced persistent disinvestment in federal and state funding (Boland & Gasman, 2014; Burmicky et al., 2024; Ortega & Swinton, 2018; Redd, 1998). In theory, philanthropic giving could help address gaps left by public funding within a mixed-economy framework (Salamon, 1987; Steinberg, 2006). In practice, however, philanthropic support for HBCUs has remained comparatively limited (Price, 2025; Toldson, 2016) and often carries implicit agendas or donor-driven priorities that may constrain HBCUs’ ability to pursue their missions on their own terms (Deng et al., 2021).Against this backdrop, MacKenzie Scott’s large, unrestricted gifts to HBCUs represent a notable departure from conventional philanthropic practice. Distributed through Yield Giving, these grants reflect a trust-based approach to philanthropy (Maradeix et al., 2025) that emphasizes flexibility, minimal reporting requirements, and confidence in recipient institutions’ leadership to determine how funds should be used. For HBCUs, such support may be especially consequential because unrestricted resources can be directed toward mission-centered priorities such as expanding student access, strengthening retention and completion efforts, and increasing degree production. In 2020, 23 HBCUs have received direct grants from Scott, and roughly 70 HBCUs have benefited indirectly through grants awarded to the Thurgood Marshall College Fund (TMCF) and the United Negro College Fund (UNCF) between 2020 and 2025. Recipient institutions were identified through a quiet search process: selected HBCUs neither applied for nor anticipated these large unrestricted gifts. As a result, these grants can be leveraged as a plausibly exogenous financial shock to HBCU leadership and institutional management. While HBCU leaders have widely praised Scott’s grants for providing flexible resources that strengthen their capacity to pursue institutional priorities, there has been little systematic empirical evidence on whether these gifts translate into measurable changes in mission-related outcomes. This study addresses that gap by estimating the effects of Scott’s grants on HBCUs’ mission-related outcomes. We construct a novel panel dataset of all HBCUs using data from the Integrated Postsecondary Education Data System (IPEDS) and the American Community Survey (ACS) spanning 2009 to 2024. Using difference-in-differences designs, we estimate the effects of direct grants awarded to individual institutions and explore the potential effects of indirect grants channeled through TMCF and UNCF on HBCUs’ mission-related outcomes. This study makes several contributions. Theoretically, it speaks to longstanding concerns about paternalism in philanthropy (Salamon, 1987) and donor control (Ostrander, 2007), while contributing to the emerging literature on trust-based philanthropy. Empirically, it provides some of the first systematic evidence on the effects of Yield Giving grants on HBCUs’ mission-related outcomes. Practically, the findings offer insight into both the promise and limitations of trust-based philanthropy and suggest how HBCUs may leverage such windfall grants to advance their missions more effectively.

Author

• Shuyi Deng, Indiana University
  Presenting Author