Abstract
The advertising effect argues that a high-quality athletic team creates a positive spillover beneficial to the academic mission. This article reexamines the proposition that a university having a successful basketball program improves the quality of incoming freshmen measured by their average SAT scores. If true, large expenditures of universities on big-time basketball and negative publicity from scandals might be justified. Previous literature provides contradictory evidence that is based on only 2 academic years. This article revisits the issue using data for academic years 1993-2002 and concludes there is no consistent evidence a highly successful basketball team has a favorable advertising effect on average SAT scores. Conference fixed effects reveal positive impacts from being in a major conference, a result that supports previous findings regarding the importance of being affiliated with a Bowl Championship Series (BCS) football conference.