An econometric analysis of the effect of fully-funded graduate education on performance for Surface Warfare officers

This thesis analyzes the impact of the Navy's fully-funded graduate education program on Surface Warfare Officer performance. Three measures of officer performance are used: probability of promotion to O-4; percent of all LT FITREPs recommended for early promotion; and the probability of receiving an early promotion recommendation on the last LT FITREP. Navy Officer Master Files (FY1981 through FY1990), created by Prof. William Bowman, USNA, are merged with NPRDC's Officer FITREP Files to statistically analyze performance differences between Surface Warfare Officers with and without fully-funded graduate education. Ordinary least squares and non-linear maximum likelihood techniques are used to estimate the three performance models. Since selection into the fully-funded program is not random, an attempt is made to model the selection process and to correct for the potential bias in the estimated coefficient of graduate education in the performance models. The findings reveal that fully- funded graduate education has a significant positive impact on the probability of promotion to 0-4, but insignificant effect on receiving early promotion recommendations on LT FITREPs. Additionally, selectivity does not appear to bias estimates of fully-funded graduate education in the performance models.