Today higher education in the United States faces the challenges of increased demand and escalating cost in the face of stagnant graduation rates. Of particular interest to the public are tax payer supported postsecondary institutions. The traditional method of funding public colleges and universities based on enrollment has shifted in 32 states to performance funding (PF) at proportions that vary by state from Tennessee's 100% to Illinois at < 1%. The present study investigated changes in graduation and retention rates in all public postsecondary institutions over time in states with > 15% PF; Tennessee with 100% PF; and states with no PF. The results clarify that public institutions without PF have had higher rates of graduation and retention than institutions with PF since at least 2004. In addition, multivariate analysis has provided evidence that PF has a significant effect on student retention in states with < 15% PF. Tennessee's 6.5% adjusted mean increase in graduation rates from 2004-2006 to 2014-2016 with 100% PF does suggest improved results. By 2018, the states of North Dakota, Colorado, and Ohio will have 3-years of experience 100% PF which will warrant additional study of outcomes, as well as institutional capacity to effectively engage in performance improvement. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com.bibliotheek.ehb.be/en-US/products/dissertations/individuals.shtml.]