Are University Presidents Paid Like CEOs?
The Chronicle of Higher Education just published its survey of public university presidents’ compensation, which rose 4.7 percent, with four presidents receiving more than $1 million. During that year, public university faculty salaries rose less than 2 percent, a discrepancy that replicated the previous four years. Why the difference?
Market explanations would be that these wages reflect jobs increasingly well done relative to faculty performance (increasing relative productivity) and/or increasing difficulty in attracting talent. The first explanation is not credible: having taught at public universities for 40 years, I’ve seen the quality of public universities decline compared to private universities. (In 1969, one could argue that 3 of the top 10 economics departments were at public universities. Today, only 1 is.) Nor is there a dearth of high-quality potential university presidents.
The best explanation is the same as that for increasing relative CEO salaries: cronyism between board members (Trustees and Regents) and the university presidents whom they appoint and meet with. Are university presidents increasingly superstars or schnorrers? You decide — it’s your tax $!