By Richard Vedder
The other day Whiz Kid Matt Denhart and I, with some assistance from Side Kick Bryan O'Keefe, reported some startling data which showed that private university presidents have been very well compensated in modern times, with salary increases far exceeding those of ordinary Americans. We also noted increases were far greater in the research extensive universities heavily dependent on federal grant support.
But how do these college presidents do relative to their own faculty, the people who actually get the research grants, make the new discoveries, and teach the students?
The evidence, gathered for me by Matt, is that salaries rose far more from 1996-7 to 2004-05 for university presidents than for the faculty. But this trend is far less clear at the non-research universities. AT THE RESEARCH ORIENTED SCHOOLS UNIVERSITY PRESIDENTS HAVE BEEN THE BIGGEST COLLECTORS OF ECONOMIC RENT, NOT THE PEOPLE PERFORMING THE CORE UNIVERSITY FUNCTIONS OF TEACHING AND RESEARCH. To be sure, the professors are doing far better than the average American worker, whose pay in inflation-adjusted terms rose in the single digits. See the Table.
AVERAGE REAL SALARY INCREASE:
TYPE OF INSTITUTION Faculty Presidents
Liberal Arts Colleges 11.1% 16.8%
Master's Degree Institutions 27.4 27.8
Doctoral - Research Intensive 27.8 47.0
Doctoral - Research Extensive 29.8 58.9
The more research oriented the school, the more robust pay increases are for faculty, but that is vastly more true for university presidents. The faculty member gets a grant, the university uses its overhead money to increase salaries, but most generously for those at the top.
When is the rip-off of taxpayers going to end?