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Compensation of Presidents, Provosts, and Professors at US Public Universities

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Title: Compensation of Presidents, Provosts, and Professors at US Public Universities
Language: English
Authors: Philip L. Hersch, Jodi E. Pelkowski
Source: Journal of Education Human Resources. 2026 44(1):205-232.
Availability: University of Toronto Press. 5201 Dufferin Street, Toronto, ON M3H 5T8, Canada. Tel: 416-667-7810; Fax: 800-221-9985; Fax: 416-667-7881; e-mail: journals@utpress.utoronco.ca; Web site: https://www.utpjournals.press/loi/jehr
Peer Reviewed: Y
Page Count: 28
Publication Date: 2026
Document Type: Journal Articles
Reports - Research
Education Level: Higher Education
Postsecondary Education
Descriptors: Public Colleges, Administrators, Presidents, Faculty, Salaries, Institutional Characteristics, Board Administrator Relationship, Boards of Education, Academic Rank (Professional), Educational Finance, Salary Wage Differentials, Individual Characteristics, Compensation (Remuneration)
DOI: 10.3138/jehr-2023-0045
ISSN: 2562-783X
Abstract: While very generous compensation packages in the corporate world have become the norm, there is growing criticism of large compensation plans for administrators at universities. We examine compensation of presidents based upon individual characteristics and institutional features of US public universities. Unlike previous research, we also consider the potential influence of the nature of the governing board. Using the method of Seemingly Unrelated Regressions, we use the same framework to estimate president, provost, and average professor salaries. This enables us to directly compare the factors driving compensation for each. Many of the institutional and individual characteristics impact the pay of university administrators and faculty similarly. We find associations and interactions matter in compensation of administrators. Presidents and provosts who have a prior connection with the university (internal hires and alums) are paid less than their counterparts. Provosts with a longer overlap of tenure with the president benefit from higher salaries than their peers. Presidents and provosts serving at universities with an autonomous rather than systemwide board enjoy higher compensation, but there is no benefit to faculty. While greater revenues and enrollment leads to more pay for everyone, faculty rewards of higher enrollment are smaller in magnitude. Personnel expenditures account for the largest percentage of a university's budget. A better understanding of the factors that affect compensation, particularly administrator pay, may become increasingly important as public criticism of university spending and the cost of higher education intensifies.
Abstractor: As Provided
Entry Date: 2026
Accession Number: EJ1501856
Database: ERIC
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  Value: <anid>AN0191107268;[mmhi]01jan.26;2026Jan28.04:06;v2.2.500</anid> <title id="AN0191107268-1">Compensation of Presidents, Provosts, and Professors at US Public Universities </title> <p>While very generous compensation packages in the corporate world have become the norm, there is growing criticism of large compensation plans for administrators at universities. We examine compensation of presidents based upon individual characteristics and institutional features of US public universities. Unlike previous research, we also consider the potential influence of the nature of the governing board. Using the method of Seemingly Unrelated Regressions, we use the same framework to estimate president, provost, and average professor salaries. This enables us to directly compare the factors driving compensation for each. Many of the institutional and individual characteristics impact the pay of university administrators and faculty similarly. We find associations and interactions matter in compensation of administrators. Presidents and provosts who have a prior connection with the university (internal hires and alums) are paid less than their counterparts. Provosts with a longer overlap of tenure with the president benefit from higher salaries than their peers. Presidents and provosts serving at universities with an autonomous rather than systemwide board enjoy higher compensation, but there is no benefit to faculty. While greater revenues and enrollment leads to more pay for everyone, faculty rewards of higher enrollment are smaller in magnitude. Personnel expenditures account for the largest percentage of a university's budget. A better understanding of the factors that affect compensation, particularly administrator pay, may become increasingly important as public criticism of university spending and the cost of higher education intensifies.</p> <p>Keywords: compensation; higher education; presidents; provosts; faculty; governance boards</p> <p>The high cost of attending college has received much attention, leading to greater scrutiny and criticism of highly paid university personnel, particularly university presidents. In the academic literature, some of the motivations for examining factors associated with compensation packages of academic administrators have included reconciling high compensation packages with high tuition, increasing student debt, reliance on state funds for financial support, and scandals associated with dismissals ([<reflink idref="bib23" id="ref1">23</reflink>]; [<reflink idref="bib28" id="ref2">28</reflink>]; [<reflink idref="bib53" id="ref3">53</reflink>]). [<reflink idref="bib51" id="ref4">51</reflink>] ask if presidential compensation at universities has gotten too generous and if their pay should be reduced. Using data from the flagship university of each state, they report growth in presidents' compensation surpassed inflation almost 32%, while faculty wage growth was just barely higher than inflation between 2010 and 2019.[<reflink idref="bib1" id="ref5">1</reflink>] In their <emph>Chronicle of Higher Education</emph> opinion piece, they discuss governing boards' role in setting presidential pay. In this paper, we examine the factors that influence the compensation of university presidents. We also estimate the compensation of two additional categories of academics: provosts and faculty. This approach enables us to make comparisons among the three groups to determine whether common factors can explain compensation disparities across academic institutions. Our analysis also differs from prior research by explicitly including measures to control for the nature and structure of the governing board, a set of factors that have been relatively overlooked.</p> <p>Interest in the pay of university presidents is not limited to academics. High presidential compensation packages have also attracted substantial attention in popular media outlets ([<reflink idref="bib35" id="ref6">35</reflink>]; [<reflink idref="bib1" id="ref7">1</reflink>]; [<reflink idref="bib50" id="ref8">50</reflink>]). In a 2021 <emph>Forbes</emph> article, Richard Vedder, a critic of higher education, argued that his cursory look at compensation data of university presidents did not seem to correlate university excellence or school size with presidential salaries. Vedder noted while presidents of universities with "superlative national reputations" were well-paid, they often make far less than much lower ranked universities. Vedder concluded that presidents often spend excessive time or resources to improve their relationships with Board of Trustees members in efforts to enhance their presidential salaries:</p> <p>A successful university president can increase her or his income substantially by becoming cozy with governing board members, and more than ever those boards are beguiled, bribed (e.g., trips on university airplanes to exotic locations) and sometimes bamboozled by smooth-talking presidents (con artists?). ([<reflink idref="bib50" id="ref9">50</reflink>], para. 8)</p> <p>Previous academic studies do find compensation of university presidents to be statistically correlated with institutional characteristics and individual attributes, but Vedder's eye towards the role in governing boards has not been given much consideration.</p> <p>While existing studies have focused on presidential compensation, and to a lesser extent faculty, neglected has been the often second-in-command of the academic arm of the university, the provost. Following prior studies, we use a framework that blends human capital and executive compensation theory to model the compensation for all three groups. In doing so, we use a more inclusive set of explanatory variables, that encompass institution, individual, and board characteristics to address the main research question:</p> <p></p> <hd id="AN0191107268-2"> • To what degree are the determinants of compensation comparable for the president, provost, and faculty? </hd> <p>Specific questions not addressed in prior studies include the following:</p> <p></p> <ulist> <item> Does a rising tide (e.g., greater resources, revenues, endowments) lift all boats in academic institutions, and if so, are the effects comparable across president, provost, and faculty?</item> <p></p> <item> Does the nature of the board (e.g., size and degree of autonomy) affect administrator pay in ways consistent with the theoretical literature?</item> <p></p> <item> Do provosts benefit from a longer working relationship with the president?</item> </ulist> <p>Before reviewing the existing literature on academic compensation, we first provide a very broad overview of the typical structure of US public universities.</p> <hd id="AN0191107268-3">A Brief Overview of US Public University Governance</hd> <p>Faculty, administrators, presidents, and governing boards are tasked to work together in the best interests of the university and its many constituents (students, potential employers, state and local communities, and taxpayers) under the guise of shared governance ([<reflink idref="bib33" id="ref10">33</reflink>]). Yet there is a level of hierarchy given states assign fiduciary duties and responsibilities to governing boards ([<reflink idref="bib46" id="ref11">46</reflink>]). The governance structure of US public universities parallels that of the corporate world. A board of trustees serves the role of the corporate board of directors. The president of the university is the chief executive officer. Titles of governing boards vary by state and institution (e.g., Board of Regents, Board of Visitors). For convenience we will refer to all by either Board of Trustees, or just the Board. Whereas corporate board members are elected by shareholders, university trustees may be appointed by state officials (governors, legislatures), by the existing board members, and in some cases by university groups (students, faculty, alumni) or are elected by the general public. Most frequently, a university is part of a state system, in which multiple universities are governed by a common board. We use the term "autonomous" to distinguish universities that are not part of a system and have their own distinct board.[<reflink idref="bib2" id="ref12">2</reflink>] Key responsibilities of all boards are to hire, fire, and set compensation of the university president (or in the case of systemwide boards, multiple presidents). Presidents serve at the pleasure of their Board of Trustees just as CEOs serve at the pleasure of corporate boards ([<reflink idref="bib46" id="ref13">46</reflink>]; [<reflink idref="bib24" id="ref14">24</reflink>]; [<reflink idref="bib43" id="ref15">43</reflink>]).</p> <p>Essentially the Board hires the president to manage the overall operations of the university. In this capacity, the president is responsible for the financial management and advancement of the institutional mission. As chief academic officer, the provost in conjunction with the president has primary responsibility for developing academic policies, overseeing faculty and tenure decisions, and managing budgets related to academic programs.[<reflink idref="bib3" id="ref16">3</reflink>] According to the [<reflink idref="bib3" id="ref17">3</reflink>], over half of college presidents surveyed in 2016 identified provosts (among the universities internal constituents) as offering the most support in advancing the mission of the institution. While institutions vary in the degree to which the board, the president, and the faculty are involved in hiring and employment decisions related to provosts, the American Association of University Professors (AAUP) Governing Statement asserts that the responsibility to hire the chief academic officers and deans should lie with the president in consultation with appropriate faculty ([<reflink idref="bib2" id="ref18">2</reflink>]).</p> <p>In the following section we review some of the extant literature on academic compensation. We also provide a brief discussion of related papers that have considered the effect of board governance structure on university outcomes. We then outline the estimation technique used in our analysis and discuss the data and variables used. This is followed by a discussion of our empirical findings and their implications.</p> <p>Our results for the compensation of presidents are consistent with other studies' estimated effects of individual and institutional attributes. Generally, the factors that impact the provosts' compensation mirror those of presidents' compensation. Presidents and provosts that were internal hires or university alums earned less than those without prior ties to their university. Higher revenue and enrollment lifts salaries across the academic arms of the institution. Greater endowments are associated with higher earnings for presidents and provosts, but not faculty. Both presidents and provosts serving at institutions with an autonomous or individual board were paid more than those working at institutions with a statewide or systemwide board. There was no evidence of a similar boost in faculty salaries at institutions with an autonomous board. A greater institutional reliance on state funding adversely affected faculty pay, but not that of the two academic officers. The longer the provost and president have worked together in their executive positions, the higher was provost pay, but not president's. A result we attribute to the president's ability to influence the pay of the provost.</p> <hd id="AN0191107268-4">Related Literature</hd> <p>The literature on university presidents' compensation combines the economic model of human capital with management theory related to executive pay. Most of the studies follow the same structure as [<reflink idref="bib11" id="ref19">11</reflink>], with institutional and individual characteristics being used to predict salaries or compensation of university presidents. For purpose of comparison, Table 1 summarizes the findings from prior studies.[<reflink idref="bib4" id="ref20">4</reflink>] In our review of relevant research, we will discuss some of the potential explanations for why institutional characteristics and personal attributes may affect presidents' pay. We then discuss the potential pay implications of Board of Trustee considerations.</p> <p>Table 1: Prior Research Results</p> <p> <ephtml> <table rules="groups"><colgroup span="1"><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /></colgroup><thead><tr><th align="left" valign="bottom" rowspan="1" colspan="1">Study</th><th align="left" valign="bottom" rowspan="1" colspan="1"><xref ref-type="bibr" rid="bibr39">Pfeffer and Ross (1988)</xref></th><th align="left" valign="bottom" rowspan="1" colspan="1"><xref ref-type="bibr" rid="bibr11">Ehrenberg, Cheslock, Epifantseva (2001)</xref></th><th align="left" valign="bottom" rowspan="1" colspan="1"><xref ref-type="bibr" rid="bibr32">Monks (2007)</xref></th><th align="left" valign="bottom" rowspan="1" colspan="1"><xref ref-type="bibr" rid="bibr23">Huang and Chen (2013)</xref></th><th align="left" valign="bottom" rowspan="1" colspan="1"><xref ref-type="bibr" rid="bibr53">Yeung, Gigliotti, Nguyen-Hoang (2019)</xref></th></tr></thead><tbody><tr><td align="left" valign="top" rowspan="1" colspan="1"><bold>Sample Description</bold></td><td align="left" valign="top" rowspan="1" colspan="1">US Colleges and Universities, Public and Private</td><td align="left" valign="top" rowspan="1" colspan="1">US Colleges and Universities, Private</td><td align="left" valign="top" rowspan="1" colspan="1">US Doctoral/ Research Universities, Public and Private</td><td align="left" valign="top" rowspan="1" colspan="1">US Universities, Public and Private<xref ref-type="table-fn" rid="tfn1">^</xref></td><td align="left" valign="top" rowspan="1" colspan="1">US Universities</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1"><bold>Salary or Compensation Data Used</bold></td><td align="left" valign="top" rowspan="1" colspan="1">College and University Personnel Association's Annual Administrative Surveys 1978–1979, 1983–1984</td><td align="left" valign="top" rowspan="1" colspan="1">Chronicle of Higher Education 1992–1993 through 1997–1998</td><td align="left" valign="top" rowspan="1" colspan="1">Chronicle of Higher Education 2001–2002 and 2002–2003</td><td align="left" valign="top" rowspan="1" colspan="1">Chronicle of Higher Education 1996–1997 to 2003–2004</td><td align="left" valign="top" rowspan="1" colspan="1">Chronicle of Higher Education 1992–1993 to 1997–1998</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1"><bold>Dependent Variable(s)</bold></td><td align="left" valign="top" rowspan="1" colspan="1">President Salary</td><td align="left" valign="top" rowspan="1" colspan="1">Ln(President Salary); Ln(President Salary + Benefits)</td><td align="left" valign="top" rowspan="1" colspan="1">Ln(President Salary)</td><td align="left" valign="top" rowspan="1" colspan="1">President Salary</td><td align="left" valign="top" rowspan="1" colspan="1">Ln(President Compensation)</td></tr><tr><td colspan="6" align="left" valign="top" rowspan="1"><bold>Individual Characteristics</bold></td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Age</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">+ Significant<xref ref-type="table-fn" rid="tfn2">*</xref></td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Female</td><td align="left" valign="top" rowspan="1" colspan="1">– Significant</td><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Minority</td><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Clergy</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">– Significant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Field of Study</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Insignificant<xref ref-type="table-fn" rid="tfn2">*</xref></td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Mixed Results</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Years in Current Position</td><td align="left" valign="top" rowspan="1" colspan="1">+ Significant</td><td align="left" valign="top" rowspan="1" colspan="1">+ Significant</td><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">+ Significant<xref ref-type="table-fn" rid="tfn2">*</xref></td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Final Year of Presidency</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Prior Experience</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Prior Presidency Insignificant; Years at Prior Presidency + Significant<xref ref-type="table-fn" rid="tfn2">*</xref></td><td align="left" valign="top" rowspan="1" colspan="1">Prior Presidency Insignificant; Years in 2 Prior Positions Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Prior Presidency +Significant<xref ref-type="table-fn" rid="tfn2">*</xref>; Years Prior President Insignificant</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Inside or External Hire</td><td align="left" valign="top" rowspan="1" colspan="1">Inside Hire – Significant<xref ref-type="table-fn" rid="tfn2">*</xref></td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /></tr><tr><td colspan="6" align="left" valign="top" rowspan="1"><bold>Institutional Characteristics</bold></td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Type University</td><td align="left" valign="top" rowspan="1" colspan="1">University + Significant; Four Year Degree + Significant; Private School + Significant<xref ref-type="table-fn" rid="tfn2">*</xref></td><td align="left" valign="top" rowspan="1" colspan="1">Research/Doctoral + Significant Comprehensive University Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1">Public School – Significant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Size</td><td align="left" valign="top" rowspan="1" colspan="1">Factor Measure<sup>a</sup> + Significant</td><td align="left" valign="top" rowspan="1" colspan="1">FTE Enrollment + Significant</td><td align="left" valign="top" rowspan="1" colspan="1">FTE Enrollment + Significant</td><td align="left" valign="top" rowspan="1" colspan="1">Enrollment + Significant</td><td align="left" valign="top" rowspan="1" colspan="1">Ln(FTE Enrollment) Insignificant</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Financial Resources</td><td align="left" valign="top" rowspan="1" colspan="1">Factor Measure<sup>b</sup> + Significant</td><td align="left" valign="top" rowspan="1" colspan="1">Endowment/Student + Significant Gifts/Student Insignificant R&D Expenditure Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1">Ln(Revenue/Student) + Significant</td><td align="left" valign="top" rowspan="1" colspan="1">Endowment + Significant State Revenues/State Expenditures Insignificant Educational Expenditures/State Revenues Insignificant State Per Capita Educational Expenditures Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1">Ln(Endowment/Student) Insignificant Ln(Gifts/Student) Insignificant Ln(R&D Expenditures) Insignificant</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Faculty Salary</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Average Professor Salary + Significant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Ln(Average Faculty Salary) + Significant<xref ref-type="table-fn" rid="tfn2">*</xref></td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Selectivity or Rank</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Freshman Test Scores + Significant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1">Freshmen's 75 Percentile SAT scores +Significant Multiple Ranking Variables by Reference Groups Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1">Avg. Freshman Test Scores Insignificant Higher Numerical Ranking – Significant Higher Numerical Rank x Private Inst. + Significant</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Regional Dummies</td><td align="left" valign="top" rowspan="1" colspan="1">Insignificant</td><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /><td align="left" valign="top" rowspan="1" colspan="1" /></tr></tbody></table> </ephtml> </p> <p>1 ^ Separate regressions were estimated and reported for public and private universities. However, different variables were in the analyses. Estimates reported in this table are for the public universities given our analysis is for public universities.</p> <p>Factor measure of size based on full-time equivalent students, faculty, and administrative staff as well as total budget.</p> <p>Factor measure of resources based on faculty/student ratio, total budget/student ratio, and total budget/faculty ratio.</p> <p>2 * Mixed results, significant in some but not all specifications</p> <hd id="AN0191107268-5">Presidential Compensation and Institutional Characteristics</hd> <p>The demands of managing a larger and more complex organization requires a leader with more advanced skills or experience ([<reflink idref="bib39" id="ref21">39</reflink>]). In the corporate world, executive compensation increases with the size and complexity of the organization ([<reflink idref="bib12" id="ref22">12</reflink>]; [<reflink idref="bib48" id="ref23">48</reflink>]; [<reflink idref="bib5" id="ref24">5</reflink>]; [<reflink idref="bib22" id="ref25">22</reflink>]; [<reflink idref="bib14" id="ref26">14</reflink>]). Similarly, larger and more complex academic institutions are likely to increase compensation to attract the most suitable candidate to fit the needs of the university ([<reflink idref="bib39" id="ref27">39</reflink>]; [<reflink idref="bib23" id="ref28">23</reflink>]; [<reflink idref="bib53" id="ref29">53</reflink>]). Enrollment and financial resources are often used as indicators of a university's relative size. Most studies find enrollment and revenues to be positively correlated with presidents' compensation ([<reflink idref="bib39" id="ref30">39</reflink>]; [<reflink idref="bib32" id="ref31">32</reflink>]; [<reflink idref="bib23" id="ref32">23</reflink>]; [<reflink idref="bib28" id="ref33">28</reflink>]).</p> <p>Universities also vary in their complexity in terms of multiplicity in objectives and degrees offered. For example, having more professional schools (medical, law, pharmacy, etc.) will expand the missions of the university. Similarly, doctoral institutions require oversight of research in addition to teaching. Institutions with more research volume and research centers are likely more challenging to administer and, therefore, command higher compensation of the president ([<reflink idref="bib39" id="ref34">39</reflink>]; [<reflink idref="bib11" id="ref35">11</reflink>]).</p> <p>[<reflink idref="bib11" id="ref36">11</reflink>] suggest factors that affect the responsibility of a president should influence presidents' compensation. In addition to the factors relating to size and complexity as identified above, they also suggest selectivity of students be included. To attract high achieving students, universities may have to offer financial packages to offset the costs of tuition. This may require a larger pool of resources or endowment to provide financial support to students. While Ehrenberg et al. find presidents in control of universities with higher average freshman test scores garner higher compensation, others have found mixed results. Some studies include rankings in addition to or in place of test scores of incoming students with mixed results on whether it impacts presidential pay ([<reflink idref="bib36" id="ref37">36</reflink>]; [<reflink idref="bib23" id="ref38">23</reflink>]; [<reflink idref="bib53" id="ref39">53</reflink>]). [<reflink idref="bib53" id="ref40">53</reflink>] attribute this to rankings being highly correlated with other institutional measures of size, financial resources, and selectivity measures.[<reflink idref="bib5" id="ref41">5</reflink>]</p> <hd id="AN0191107268-6">Compensation of Presidents and Individual Characteristics</hd> <p>Human capital is a broad term that refers to the stock of knowledge and skills an individual or labor force possesses. It is important as it greatly bears upon how productive workers are and how much they are compensated. [<reflink idref="bib31" id="ref42">31</reflink>] and [<reflink idref="bib6" id="ref43">6</reflink>] developed very basic models of the relationship between schooling, education, and earnings. Labor economists have extended the Mincer-Becker model to include other factors related to earnings, such as gender, race, and work experience ([<reflink idref="bib48" id="ref44">48</reflink>]; [<reflink idref="bib44" id="ref45">44</reflink>]; [<reflink idref="bib40" id="ref46">40</reflink>]).</p> <p>In the same way that companies seek to hire individuals with the skill sets that match their needs, Board of Trustees similarly seek candidates possessing the necessary skills to lead a university. While formal education is one way to accumulate human capital, experience can also informally enhance skill sets and knowledge, often referred to as on-the-job training. Some skills are transferable across positions, but having longer tenure in a specific role is likely to lead to increased earnings as compared to general work experience ([<reflink idref="bib29" id="ref47">29</reflink>]). Consequently, having previous experience as a president and maintaining a longer tenure in the role is expected to increase the effectiveness and compensation of a university president. Most studies find experience as a president at a different institution does not impact pay. However, longer tenure in the current presidential position enhances pay of a president ([<reflink idref="bib11" id="ref48">11</reflink>]; [<reflink idref="bib32" id="ref49">32</reflink>]; [<reflink idref="bib53" id="ref50">53</reflink>]; [<reflink idref="bib28" id="ref51">28</reflink>]).</p> <p>Whether the individual comes from within the institution has also been identified as a factor that may influence compensation. External hires may benefit from greater bargaining power in negotiation of compensation. Higher compensation may also be needed to gain interest or broaden the pool of external applicants. Given internal hires do not have to incur costs associated with moving locations or changing organizations, they may be willing to accept a smaller boost in pay associated with their promotion. [<reflink idref="bib39" id="ref52">39</reflink>] and [<reflink idref="bib28" id="ref53">28</reflink>] make note of these potential differences and find administrators that were hired from within the ranks of the university received lower pay as compared to external hires.</p> <p>Relative compensation may also be shaped by the specialty fields of the individual. Individuals with expertise in law, engineering, medicine, and other STEM related fields often earn more than those specializing in the humanities, social sciences, or education in both academic and nonacademic settings. Earnings differentials across fields are likely not only among faculty but also in the executive ranks. [<reflink idref="bib32" id="ref54">32</reflink>] estimated salaries of presidents of public and private universities. While background of presidents were not significant determinants in the public institutions, having a science or mathematical background was associated with higher salaries of the leaders of the private universities.</p> <p>Differences in earnings across demographic groups have received a great deal of attention in labor economics studies. Earnings differences may be due to productivity, education quality, experience, labor force attachment, or non-productivity differences associated with discrimination. Males are often found to have a wage premium for comparable work ([<reflink idref="bib16" id="ref55">16</reflink>]; [<reflink idref="bib8" id="ref56">8</reflink>]). However, at the executive rank, there is mixed evidence of gender differences in pay with some studies finding females are paid less, while others find no difference after controlling for other factors such as experience and industry ([<reflink idref="bib7" id="ref57">7</reflink>]; [<reflink idref="bib45" id="ref58">45</reflink>]; [<reflink idref="bib15" id="ref59">15</reflink>]). Earnings differentials are also found across races, with minorities facing lower wages ([<reflink idref="bib25" id="ref60">25</reflink>]). Similar to gender differences at the executive level, for minorities the results are mixed. Some research suggests being of minority background has either no significant impact or may lead to higher relative earnings for executives ([<reflink idref="bib21" id="ref61">21</reflink>]; [<reflink idref="bib19" id="ref62">19</reflink>]). However, once ethnic races are broken down further, [<reflink idref="bib19" id="ref63">19</reflink>] finds African American executives receive significantly lower pay.</p> <hd id="AN0191107268-7">Potential Role of Governing Boards on Compensation</hd> <p>University president employment terms are subject to the approval of the Board of Trustees ([<reflink idref="bib46" id="ref64">46</reflink>]). Boards may vary in how trustees are selected and in the number of trustees that comprise the board. Some boards are autonomous overseeing one university while others oversee multiple universities. Little is known as to how the varying structure of the board specifically relates to the compensation of the president hired by the board.</p> <p>[<reflink idref="bib27" id="ref65">27</reflink>] contends government officials should prefer lower tuition prices and university budgets. Conversely, university administrators and personnel prefer larger budgets to support programs and enhance salaries. As a larger proportion of the trustees on a board are appointed by state officials (rather than university groups or existing board members), trustees' incentives and board decisions should better align with state elected officials' preferences. Given compensation of presidents and the personnel are a large part of the budget, a board with more state-appointed trustees may restrain administrative and faculty pay ([<reflink idref="bib27" id="ref66">27</reflink>]).</p> <p>Borrowing from the corporate governance literature, board effectiveness may be related to the number of board members. Larger board size has often been found to be associated with higher executive salaries in corporations ([<reflink idref="bib18" id="ref67">18</reflink>]; [<reflink idref="bib9" id="ref68">9</reflink>]). While having more members may increase the ability to monitor and greater collective information, larger boards may suffer from coordination and free rider problems ([<reflink idref="bib10" id="ref69">10</reflink>]; [<reflink idref="bib17" id="ref70">17</reflink>]; [<reflink idref="bib20" id="ref71">20</reflink>]). As the number of board members increase, the coordination problem stems from members having their own priorities which may lead to conflicting demands and interests. Individuals may rely on the expertise and efforts of others to monitor and advise the organization to reduce their own costs of being informed and engaged as the board size grows.</p> <p>Trustees are more likely to align their efforts with the interests of the elected officials when the elected officials' costs of monitoring and influencing board members are lower. These supervisory costs to officials will be smaller if the state has fewer boards and as the number of campuses a board oversees decreases. Trustees at universities governed by a systemwide board are expected to have greater influence and control over tuition and expenses than those who govern over an individual institution ([<reflink idref="bib27" id="ref72">27</reflink>]). If [<reflink idref="bib50" id="ref73">50</reflink>] is correct that university presidents have the incentive to cozy up to the board to enhance their salaries, it may be easier to curry favor with a board that supervises fewer presidents. For these two reasons, pay is expected to be higher for presidents who serve universities with an autonomous board.</p> <p>[<reflink idref="bib27" id="ref74">27</reflink>] does not explicitly look at how the structure of governing boards impact the salaries of administrators or faculty. However, he does estimate how university characteristics and the governmental structure impacts tuition and broad categories of spending. One of the categories, which he labels spending on instruction, includes total expenditures on faculty and academic administrators, as well as credit and non-credit activities, and some research and public service expenditures. He finds the number of campuses governed by a board does not have a statistically significant impact on this spending category. However, the board having a larger percent of trustees who are selected by government officials or are publicly voted onto the board lowers these expenditures.</p> <p>In 2016, Tennessee changed their governance structure from having one systemwide board to allow for six universities to establish their own autonomous boards. [<reflink idref="bib37" id="ref75">37</reflink>] contends independent boards may create more pressure or increased competition for resources in the pursuit of higher rankings for their respective universities. As universities and their boards seek competitive advantages or greater prestige, compensation may be increased to attract a more effective president and faculty with high research activity. Consistent with his expectations, Odle found an increase in presidential pay, average professor salaries, and research expenditures associated with the university moving to an autonomous system, controlling for university characteristics.</p> <hd id="AN0191107268-8">Compensation of Other University Administrators and Faculty</hd> <p>The pay of provosts has not yet specifically been explored. However, a couple of studies have extended their analyses of presidential compensation to include additional administrators. [<reflink idref="bib36" id="ref76">36</reflink>] examined whether institutional characteristics associated with performance had similar impact on the executive (president) and "middle-level executives" (deans and vice presidents of finance and development) at US private liberal arts colleges. In some of the specifications, having a better reputation based on <emph>U.S. News and World Report</emph> rankings and higher faculty salaries were associated with significantly higher salaries for both presidents and deans. Higher net price (tuition and fees minus financial aid) was a significant factor in president pay but not for the other administrators. The magnitude of the statistically significant impact of faculty salaries was higher for deans than presidents. O'Connell suggests this may be due to deans rising from the rank of faculty. A higher endowment yield was associated with statistically significant higher salaries for deans. Gender, the only individual characteristic included in his estimates, did not have a significant bearing on compensation for any of the positions.</p> <p>[<reflink idref="bib28" id="ref77">28</reflink>] used data from Ontario, Canada, universities to look at compensation of presidents, vice presidents of various divisions, associate vice presidents, and college deans. Throughout the ranks, administrators of universities with larger revenues received higher compensation. In specifications only controlling for gender, position, institutional characteristics, and whether the individual pursued a career in the academy (i.e., held a tenured or tenure-track position), female administrators earned approximately 4% less than the males. However, once academic fields, experience, and tenure in position were included, the gender difference in compensation was not significant. Administrators with fields in business, engineering, law, nursing, and social work earned higher levels of compensation compared to those with a background in the humanities, sciences, and social work. Administrators with health science background had the highest earning premium. Compensation of external hires was about 9% higher than internal hires. Mang's approach of combining all administrators into a single equation limited his ability to compare the effects of individual and institutional attributes across administrative roles.</p> <p>Most studies that explore the determinants of faculty earnings concentrate on an individual's research and teaching to estimate individual-level pay. However, there is one study, conducted by [<reflink idref="bib42" id="ref78">42</reflink>], that looked at average faculty salaries using factors related to the institution. This is a more similar approach to the studies of presidential pay. In their estimates, percent of faculty being female was insignificant. They found enrollment, endowment per student, and total revenue per student were all associated with higher average faculty salaries, similar to studies of presidential pay. Percent of applicants admitted, a measure of non-selectivity in admissions, was inversely related with faculty salaries. Rippner and Toutkoushian results indicate universities with a larger percentage of STEM majors also had faculty with higher average salaries. This is likely due to universities having to compete with industry for faculty who teach and research in STEM fields.</p> <p>We use the insights from the literature to model three compensation equations, one each for the university's president, provost, and average salary of its full professors. In addition, we consider whether the structure of the governing board that is tasked with fiduciary responsibility and oversight of the organization, the Board of Trustees, has impact on the financial compensation of the administration and faculty.</p> <hd id="AN0191107268-9">Empirical Analysis</hd> <p>Our basic model follows that of [<reflink idref="bib11" id="ref79">11</reflink>], who estimate the compensation of presidents as a function of individual characteristics and institutional attributes, using the natural log of salaries as the dependent variable.[<reflink idref="bib6" id="ref80">6</reflink>] Given we are interested in comparing across the three categories of university personnel, we specify a separate regression equation for president, provost, and average professor compensation. Each equation takes the form given by Eq. (<reflink idref="bib1" id="ref81">1</reflink>):</p> <p> <ephtml> <math display="block" xmlns="http://www.w3.org/1998/Math/MathML"><mrow><mtext>ln</mtext><mrow><mo>(</mo><mrow><mtext>COMPENSATION</mtext></mrow><mo>)</mo></mrow><mo>=</mo><msub><mi>β</mi><mn>0</mn></msub><mo>+</mo><msub><mi>β</mi><mn>1</mn></msub><mtext> </mtext><mtext>INDIVIDUAL</mtext><mo>+</mo><msub><mi>β</mi><mn>2</mn></msub><mtext> </mtext><mtext>INSTITUTIONAL</mtext><mo>+</mo><msub><mi>β</mi><mn>3</mn></msub><mtext> </mtext><mtext>BOARD</mtext><mo>+</mo><mi>ϵ</mi><mo>.</mo></mrow></math> </ephtml> (<reflink idref="bib1" id="ref82">1</reflink>)</p> <p>In Eq (<reflink idref="bib1" id="ref83">1</reflink>), ln(COMPENSATION) is the natural log of either president, provost, or professor compensation. Three sets of explanatory variables are included in each equation. INDIVIDUAL is a vector or set of variables that comprises individual characteristics of the president, provost, or faculty. The second set or vectors of variables, INSTITUTIONAL, identifies with the university and its environs often used in other studies. BOARD is the third vector or set of variables that are associated with structure of the board. The error term is represented by ε.</p> <p>To estimate the three compensation equations, we use the method of Seemingly Unrelated Regressions (SUR). SUR is appropriate when two or more regression equations, each with their own set of explanatory variables and estimated parameters may have correlated error terms. This is appropriate when the equations are derived from the same basic economic theory ([<reflink idref="bib52" id="ref84">52</reflink>]). In our estimates, correlation is expected across our three equations due to their shared political and financial university environment. Below we discuss the data and variables that are used in the vectors of individual, institution, and board characteristics. We also describe the predicted relationships between compensation and the three sets of variables used in the analysis.</p> <hd id="AN0191107268-10">Data and Variables</hd> <p>We hand-collected information regarding presidents and provosts from university websites, media reports, and state employee compensation records to supplement <emph>Chronicle of Higher Education</emph> data. We combine these with institutional measures from the Integrated Postsecondary Education Data System (IPEDS). In addition, attributes pertaining to the structure of the Board of Trustees for each institution were collected from the state profile data sheets from the Association of Governing Boards of University and Colleges (AGB). The sample is an unbalanced cross-section of public universities covering the academic years of 2016 and 2017. Universities with either an interim president or interim provost in a given year were excluded, as were schools where the president or provost were in office for only a portion of the year. For pairing purposes, compensation data was needed for both president and provost. Compensation data is less readily available for provosts for which only 432 observations could be obtained. After accounting for missing data for either a provost or a paired president, there are 307 observations in our final sample, 187 for 2016 and 120 for 2017.</p> <p>For comparison purposes we use a narrow definition of compensation that includes base salary and bonuses. The <emph>Chronicle of Education</emph> provides additional income sources for presidents, such as retirement contributions and housing, but not all presidents are included in that dataset.[<reflink idref="bib7" id="ref85">7</reflink>] For the non-Chronicle group, compensation was primarily culled from state public employee websites and occasionally from on-line newspapers or other media accounts. Definitions, sample statistics, and data sources of the compensation and explanatory variables are provided in Table 2. A criticism of president pay is that it far exceeds that of the average professor. Using our narrow definition of president pay, within our sample its mean is 3.7 times that of professors.[<reflink idref="bib8" id="ref86">8</reflink>] In comparison, mean provost compensation also exceeds professors', with the mean provost salary 2.7 times higher than average faculty salaries. Inclusion of faculty with lower rankings, including adjuncts and clinical instructors with much lower wages and fewer benefits that are becoming more prevalent in the academic departments, likely lead to a much larger ratio of university president to the median employee earnings. Large compensation packages to executives at public universities may fall under a more critical lens or be less acceptable as compared to the corporate world, given public universities are the recipients of state and local government appropriations.</p> <p>Table 2: Sample Statistics (<emph>N</emph> = 307)</p> <p> <ephtml> <table rules="groups"><colgroup span="1"><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /></colgroup><thead><tr><th align="left" valign="top" rowspan="1" colspan="1" /><th align="left" valign="top" rowspan="1" colspan="1">Mean</th><th align="left" valign="top" rowspan="1" colspan="1">Std. dev</th><th align="left" valign="top" rowspan="1" colspan="1">Min</th><th align="left" valign="top" rowspan="1" colspan="1">Max</th><th align="left" valign="top" rowspan="1" colspan="1">Description (Data sources)</th></tr></thead><tbody><tr><td align="left" valign="top" rowspan="1" colspan="1">President Compensation</td><td align="left" valign="top" rowspan="1" colspan="1">$379,546</td><td align="left" valign="top" rowspan="1" colspan="1">$143,653</td><td align="left" valign="top" rowspan="1" colspan="1">$172,455</td><td align="left" valign="top" rowspan="1" colspan="1">$1,000,000</td><td align="left" valign="top" rowspan="1" colspan="1">Salary and bonus of president. (Chronicle of Higher Education, State employee compensation sites)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost Compensation</td><td align="left" valign="top" rowspan="1" colspan="1">$270,820</td><td align="left" valign="top" rowspan="1" colspan="1">$95,342</td><td align="left" valign="top" rowspan="1" colspan="1">$98,700</td><td align="left" valign="top" rowspan="1" colspan="1">$610,554</td><td align="left" valign="top" rowspan="1" colspan="1">Salary and bonus of provost. (Chronicle of Higher Education, State employee compensation sites)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Professor Compensation</td><td align="left" valign="top" rowspan="1" colspan="1">$103,144</td><td align="left" valign="top" rowspan="1" colspan="1">$23,694</td><td align="left" valign="top" rowspan="1" colspan="1">$58,975</td><td align="left" valign="top" rowspan="1" colspan="1">$193,097</td><td align="left" valign="top" rowspan="1" colspan="1">Average salary of university's full professors. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Female President</td><td align="left" valign="top" rowspan="1" colspan="1">0.221</td><td align="left" valign="top" rowspan="1" colspan="1">0.416</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President is female. (University websites)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Female Provost</td><td align="left" valign="top" rowspan="1" colspan="1">0.384</td><td align="left" valign="top" rowspan="1" colspan="1">0.487</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost is female. (University websites)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Faculty Female</td><td align="left" valign="top" rowspan="1" colspan="1">0.325</td><td align="left" valign="top" rowspan="1" colspan="1">0.0944</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">0.643</td><td align="left" valign="top" rowspan="1" colspan="1">Percent of faculty that are female. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Minority President</td><td align="left" valign="top" rowspan="1" colspan="1">0.137</td><td align="left" valign="top" rowspan="1" colspan="1">0.344</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President is a minority member. (University websites)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Minority Provost</td><td align="left" valign="top" rowspan="1" colspan="1">0.0944</td><td align="left" valign="top" rowspan="1" colspan="1">0.293</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost is a minority member. (University websites)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Faculty Minority</td><td align="left" valign="top" rowspan="1" colspan="1">0.0800</td><td align="left" valign="top" rowspan="1" colspan="1">0.0943</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">0.678</td><td align="left" valign="top" rowspan="1" colspan="1">Percent of faculty that are non-white. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President External</td><td align="left" valign="top" rowspan="1" colspan="1">0.769</td><td align="left" valign="top" rowspan="1" colspan="1">0.422</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President was an external hire. (Internet search)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost External</td><td align="left" valign="top" rowspan="1" colspan="1">0.609</td><td align="left" valign="top" rowspan="1" colspan="1">0.489</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost was an external hire. (Internet search)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President's Tenure</td><td align="left" valign="top" rowspan="1" colspan="1">6.51</td><td align="left" valign="top" rowspan="1" colspan="1">5.16</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">25</td><td align="left" valign="top" rowspan="1" colspan="1">Years serving as President, excluding interim. (Chronicle and Internet search)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost's Tenure</td><td align="left" valign="top" rowspan="1" colspan="1">3.82</td><td align="left" valign="top" rowspan="1" colspan="1">2.75</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">15</td><td align="left" valign="top" rowspan="1" colspan="1">Years serving as Provost, excluding interim. (Internet search)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Overlap</td><td align="left" valign="top" rowspan="1" colspan="1">2.79</td><td align="left" valign="top" rowspan="1" colspan="1">2.21</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">12</td><td align="left" valign="top" rowspan="1" colspan="1">Number of years president and provost have served together.</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President Alum</td><td align="left" valign="top" rowspan="1" colspan="1">0.114</td><td align="left" valign="top" rowspan="1" colspan="1">0.318</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President is an alum of the University. (Internet search)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost Alum</td><td align="left" valign="top" rowspan="1" colspan="1">0.0814</td><td align="left" valign="top" rowspan="1" colspan="1">0.274</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost is an alum of the university. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President_Business</td><td align="left" valign="top" rowspan="1" colspan="1">0.0977</td><td align="left" valign="top" rowspan="1" colspan="1">0.297</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President's field is business or economics. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President_STEM</td><td align="left" valign="top" rowspan="1" colspan="1">0.241</td><td align="left" valign="top" rowspan="1" colspan="1">0.428</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President's field is STEM. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President_Law</td><td align="left" valign="top" rowspan="1" colspan="1">0.0977</td><td align="left" valign="top" rowspan="1" colspan="1">0.297</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President's field is law. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President_Humanities</td><td align="left" valign="top" rowspan="1" colspan="1">0.114</td><td align="left" valign="top" rowspan="1" colspan="1">0.318</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President's field is in the humanities. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">President_Education</td><td align="left" valign="top" rowspan="1" colspan="1">0.192</td><td align="left" valign="top" rowspan="1" colspan="1">0.395</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">President's field is education. (Internet).</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost_Business</td><td align="left" valign="top" rowspan="1" colspan="1">0.0554</td><td align="left" valign="top" rowspan="1" colspan="1">0.229</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost's field is business or economics. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost_STEM</td><td align="left" valign="top" rowspan="1" colspan="1">0.329</td><td align="left" valign="top" rowspan="1" colspan="1">0.471</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost's field is STEM. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost_Law</td><td align="left" valign="top" rowspan="1" colspan="1">0.0228</td><td align="left" valign="top" rowspan="1" colspan="1">0.150</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost's field is law. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost_Humanities</td><td align="left" valign="top" rowspan="1" colspan="1">0.296</td><td align="left" valign="top" rowspan="1" colspan="1">0.457</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost's field is in the humanities. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Provost_Education</td><td align="left" valign="top" rowspan="1" colspan="1">0.0847</td><td align="left" valign="top" rowspan="1" colspan="1">0.279</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Provost's field is education. (Internet)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Enrollment</td><td align="left" valign="top" rowspan="1" colspan="1">15,352</td><td align="left" valign="top" rowspan="1" colspan="1">11,811</td><td align="left" valign="top" rowspan="1" colspan="1">754</td><td align="left" valign="top" rowspan="1" colspan="1">60,310</td><td align="left" valign="top" rowspan="1" colspan="1">University full-time equivalent fall enrollment. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Revenue per Enrollment</td><td align="left" valign="top" rowspan="1" colspan="1">$0.0270</td><td align="left" valign="top" rowspan="1" colspan="1">$0.0143</td><td align="left" valign="top" rowspan="1" colspan="1">$.00953</td><td align="left" valign="top" rowspan="1" colspan="1">$0.108</td><td align="left" valign="top" rowspan="1" colspan="1">Total revenue ($ millions) per fall FTE student enrollment. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Research</td><td align="left" valign="top" rowspan="1" colspan="1">0.485</td><td align="left" valign="top" rowspan="1" colspan="1">0.500</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Carnegie designated research university. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Endowment</td><td align="left" valign="top" rowspan="1" colspan="1">$331</td><td align="left" valign="top" rowspan="1" colspan="1">$875</td><td align="left" valign="top" rowspan="1" colspan="1">$0.247</td><td align="left" valign="top" rowspan="1" colspan="1">$9,754</td><td align="left" valign="top" rowspan="1" colspan="1">University endowment. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Admit</td><td align="left" valign="top" rowspan="1" colspan="1">0.680</td><td align="left" valign="top" rowspan="1" colspan="1">0.172</td><td align="left" valign="top" rowspan="1" colspan="1">0.160</td><td align="left" valign="top" rowspan="1" colspan="1">1.00</td><td align="left" valign="top" rowspan="1" colspan="1">Admission rate. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent State Appropriations</td><td align="left" valign="top" rowspan="1" colspan="1">0.287</td><td align="left" valign="top" rowspan="1" colspan="1">0.111</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">0.61</td><td align="left" valign="top" rowspan="1" colspan="1">Percent of university revenue from state (IPEDS) appropriations. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Students SML</td><td align="left" valign="top" rowspan="1" colspan="1">0.139</td><td align="left" valign="top" rowspan="1" colspan="1">0.0699</td><td align="left" valign="top" rowspan="1" colspan="1">0.193</td><td align="left" valign="top" rowspan="1" colspan="1">0.497</td><td align="left" valign="top" rowspan="1" colspan="1">Percent of students receiving STEM, medical, or law degrees. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Autonomous</td><td align="left" valign="top" rowspan="1" colspan="1">0.365</td><td align="left" valign="top" rowspan="1" colspan="1">0.482</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Equals 1, if the university is governed by its own board, not a system board. (Assoc. of Governing Boards, AGB)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Board Size</td><td align="left" valign="top" rowspan="1" colspan="1">14.5</td><td align="left" valign="top" rowspan="1" colspan="1">6.08</td><td align="left" valign="top" rowspan="1" colspan="1">5</td><td align="left" valign="top" rowspan="1" colspan="1">32</td><td align="left" valign="top" rowspan="1" colspan="1">Log of number of board voting members. (AGB)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Govt</td><td align="left" valign="top" rowspan="1" colspan="1">0.874</td><td align="left" valign="top" rowspan="1" colspan="1">0.188</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Percent of voting trustees appointed by the governor, legislature, or elected. (AGB)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Urban</td><td align="left" valign="top" rowspan="1" colspan="1">0.704</td><td align="left" valign="top" rowspan="1" colspan="1">0.457</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">University is located in an urbanized area. (IPEDS)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">State Price Index</td><td align="left" valign="top" rowspan="1" colspan="1">98.3</td><td align="left" valign="top" rowspan="1" colspan="1">9.34</td><td align="left" valign="top" rowspan="1" colspan="1">85.7</td><td align="left" valign="top" rowspan="1" colspan="1">115.8</td><td align="left" valign="top" rowspan="1" colspan="1">Relative State Price Index; US = 100. (US Bureau of Economic Analysis)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Midwest</td><td align="left" valign="top" rowspan="1" colspan="1">0.248</td><td align="left" valign="top" rowspan="1" colspan="1">0.432</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">University is located in a Midwest census region.</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">West</td><td align="left" valign="top" rowspan="1" colspan="1">0.166</td><td align="left" valign="top" rowspan="1" colspan="1">0.373</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">University is located in a Western Census region.</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Year</td><td align="left" valign="top" rowspan="1" colspan="1">0.391</td><td align="left" valign="top" rowspan="1" colspan="1">0.489</td><td align="left" valign="top" rowspan="1" colspan="1">0</td><td align="left" valign="top" rowspan="1" colspan="1">1</td><td align="left" valign="top" rowspan="1" colspan="1">Dummy variable = 1, if year is 2017.</td></tr></tbody></table> </ephtml> </p> <hd id="AN0191107268-11">Individual Characteristics</hd> <p>For presidents and provosts, dummy variables are used for gender and minority (nonwhite) status,[<reflink idref="bib9" id="ref87">9</reflink>] whether they are alums of the institution they work for and whether they were external hires. Females and minorities may be susceptible to an earnings gap. Alum status could be associated with a willingness to accept lower compensation to return to their alma mater. External hires are expected to command higher compensation due to a more competitive search process and some degree of being able to negotiate higher wages to compensate for costs related to relocation. Following [<reflink idref="bib28" id="ref88">28</reflink>], we include dummy variables for the president and provost's academic field to account for some areas (e.g., STEM, business) having higher opportunity costs of switching to an administrative role. Time in their respective positions is accounted for by president and provost tenure. The president and the provost work together, but ultimately the provost serves the president. To account for this relationship we create the variable <emph>Overlap</emph>, the number of years the two have worked together in their respective roles. A longer overlap could indicate a stronger working relationship between the president and provost, which could lead to the president advocating for higher provost compensation. A better working relationship could make for a more effective president, enhancing their compensation as well. In the faculty equation, we have both the percent of professors who are female and the percent who are minority. We cannot directly control for the mix of faculty degrees but proxy for it with percent of students receiving degrees in STEM disciplines, medicine, or law.</p> <hd id="AN0191107268-12">Structure of the Board of Trustees</hd> <p>A dummy variable ( = 1) is used to indicate that a university's board is autonomous, as opposed to being part of a Regent's system. System boards may be compelled to mitigate pay disparities among their schools. As [<reflink idref="bib37" id="ref89">37</reflink>] discusses, autonomous boards may focus more on prestige of their particular institution so may pay more to hire presidents, provosts, and faculty consistent with those goals. Moreover, boards may succumb to the schmoozing of presidents when they oversee one rather than a system of universities. If a board is more aligned with state officials' desire to control costs and have smaller budgets as [<reflink idref="bib27" id="ref90">27</reflink>] suggests, system boards and boards with more trustees appointed by the state may be more constrained in compensation of university personnel. As discussed in the review of literature, power dynamics related to the collective action and free-rider problems that occur in larger boards may favor the CEO. This may be true too of university boards enabling presidents to secure higher compensation. To control for these factors, we include variables for board voting size and percent of voting trustees who are appointed by the state (the governor, legislature, or state voters).</p> <hd id="AN0191107268-13">Institutional Characteristics</hd> <p>Size of institution is measured by FTE student enrollment. Quality and mission are controlled for by percent of students admitted, university endowment, and Carnegie research designation. The aforementioned variables aim to account for the complexity of the university. Although all the universities in the sample are state institutions, some are more reliant on state funding (and the scrutiny it brings) than others. We account for this with percent of university revenues coming from state appropriations. Overall revenue per student full-time equivalent (FTE) is also included. Higher revenue provides the resource for higher compensation but is likely endogenous – higher salaries may lead to higher tuition from which to pay for them. Consequently, in some specifications we estimated the equations excluding this variable. Because its inclusion/exclusion does not affect the other results, we only report the former. Lastly to account for cost of living and other factors, we include regional dummy variables, a state price index, and a dummy variable for sample year.</p> <hd id="AN0191107268-14">Results</hd> <p>Results are reported in Table 3. A quick takeaway is that a rising tide lifts all boats. Comparable to previous studies, executive pay increases at institutions with larger enrollments and financial resources. Specifically, Log Enrollment and Revenue per Enrollment are positive and significant across the equations. An economist's measure to conveniently interpret and compare coefficients is the concept of elasticity. Specifically, elasticity is the percentage change in the dependent variable associated with a 1% change in an independent variable. When both the dependent and independent variable are expressed in logs, the elasticity is simply the coefficient in the regression equation. The elasticities for enrollment in the president and provost equations are 0.16 and 0.18 respectively. Consequently, a 1% rise in enrollment increases compensation by less than two-tenths of a percent.[<reflink idref="bib10" id="ref91">10</reflink>] Both are still statistically larger (1% level) than for professor compensation which has about half the elasticity, 0.070. With regards to Revenue per Enrollment, we find no statistical difference between the three coefficients, with a one-standard deviation increase raising compensation by about 5% to 6%. Larger endowments increase president and provost compensation. The response is small however (0.041 and 0.031), and despite the president's greater role in fundraising, they are not statistically different.[<reflink idref="bib11" id="ref92">11</reflink>] Higher endowments were not found to impact faculty. This is a bit surprising given endowed chairs provide stipends, but evidently not enough to lift the average professor pay. A greater dependency on state funding as measured by the percent of revenues coming from the state negatively impacts faculty salaries. For four-year public universities, outlays related to instruction (which includes faculty salaries) are the largest expenditure ([<reflink idref="bib34" id="ref93">34</reflink>]). Political pressure may be present to constrain spending when revenues come from state appropriations. Here, a one-standard deviation increase in state funding reliance reduces professor salaries by about 2.4%. No detrimental effect is found for presidents or provosts.</p> <p>Table 3: SUR Regression Results (<emph>N</emph> = 307)</p> <p> <ephtml> <table rules="groups"><colgroup span="1"><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /><col align="left" valign="top" span="1" /></colgroup><thead><tr><th align="left" valign="top" rowspan="1" colspan="1" /><th align="left" valign="top" rowspan="1" colspan="1">Log President Compensation</th><th align="left" valign="top" rowspan="1" colspan="1">Log Provost Compensation</th><th align="left" valign="top" rowspan="1" colspan="1">Log Professor Compensation</th></tr></thead><tbody><tr><td align="left" valign="top" rowspan="1" colspan="1">Female</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0476<xref ref-type="table-fn" rid="tfn4">b</xref> (0.0169)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0252<xref ref-type="table-fn" rid="tfn5">c</xref> (0.0148)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Minority</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0242 (0.0226)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0131 (0.0243)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">External</td><td align="left" valign="top" rowspan="1" colspan="1">0.0679<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0217)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0630<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0141)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Tenure</td><td align="left" valign="top" rowspan="1" colspan="1">−0.000160 (0.00192)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.00718<xref ref-type="table-fn" rid="tfn4">b</xref> (0.00321)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Overlap</td><td align="left" valign="top" rowspan="1" colspan="1">0.000911 (0.00468)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0201<xref ref-type="table-fn" rid="tfn3">a</xref> (0.00427)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Alum</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0502<xref ref-type="table-fn" rid="tfn5">c</xref> (0.0284)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0701<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0251)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Business</td><td align="left" valign="top" rowspan="1" colspan="1">0.115<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0315)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.00739 (0.0394)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">STEM</td><td align="left" valign="top" rowspan="1" colspan="1">0.00636 (0.0229)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0136 (0.0172)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Law</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0432 (0.0316)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0203 (0.0276)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Humanities</td><td align="left" valign="top" rowspan="1" colspan="1">0.0697<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0237)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0122 (0.0180)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Education</td><td align="left" valign="top" rowspan="1" colspan="1">0.0314 (0.0225)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0327 (0.0253)</td><td align="left" valign="top" rowspan="1" colspan="1">----</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Faculty Female</td><td align="left" valign="top" rowspan="1" colspan="1">----</td><td align="left" valign="top" rowspan="1" colspan="1">----</td><td align="left" valign="top" rowspan="1" colspan="1">−0.140<xref ref-type="table-fn" rid="tfn4">b</xref> (0.0689)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Faculty Minority</td><td align="left" valign="top" rowspan="1" colspan="1">----</td><td align="left" valign="top" rowspan="1" colspan="1">----</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0887 (0.0670)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Log Enrollment</td><td align="left" valign="top" rowspan="1" colspan="1">0.162<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0190)</td><td align="left" valign="top" rowspan="1" colspan="1">0.184<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0183)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0694<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0118)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Revenue per Enrollment</td><td align="left" valign="top" rowspan="1" colspan="1">3.43<xref ref-type="table-fn" rid="tfn4">b</xref> (1.40)</td><td align="left" valign="top" rowspan="1" colspan="1">3.86<xref ref-type="table-fn" rid="tfn3">a</xref> (1.09)</td><td align="left" valign="top" rowspan="1" colspan="1">3.87<xref ref-type="table-fn" rid="tfn3">a</xref> (0.562)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Research</td><td align="left" valign="top" rowspan="1" colspan="1">0.112<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0294)</td><td align="left" valign="top" rowspan="1" colspan="1">0.158<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0247)</td><td align="left" valign="top" rowspan="1" colspan="1">0.121<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0168)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Log Endowment</td><td align="left" valign="top" rowspan="1" colspan="1">0.0413<xref ref-type="table-fn" rid="tfn3">a</xref> (0.00956)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0306<xref ref-type="table-fn" rid="tfn3">a</xref> (0.00837)</td><td align="left" valign="top" rowspan="1" colspan="1">0.00432 (0.00656)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Admit</td><td align="left" valign="top" rowspan="1" colspan="1">0.175<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0604)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0127 (0.0569)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0383 (0.0402)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent State Appropriations</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0284 (0.108)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0229 (0.0913)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.216<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0775)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Students SML</td><td align="left" valign="top" rowspan="1" colspan="1">0.518<xref ref-type="table-fn" rid="tfn3">a</xref> (0.140)</td><td align="left" valign="top" rowspan="1" colspan="1">0.347<xref ref-type="table-fn" rid="tfn4">b</xref> (0.138)</td><td align="left" valign="top" rowspan="1" colspan="1">0.201<xref ref-type="table-fn" rid="tfn5">c</xref> (0.112)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Autonomous</td><td align="left" valign="top" rowspan="1" colspan="1">0.0873<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0228)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0661<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0200)</td><td align="left" valign="top" rowspan="1" colspan="1">0.000197 (0.0124)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Log Board Size</td><td align="left" valign="top" rowspan="1" colspan="1">−0.00170 (0.0267)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0679<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0244)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0272 (0.0188)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Percent Board Govt</td><td align="left" valign="top" rowspan="1" colspan="1">0.00340 (0.0544)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0145 (0.0487)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0388 (0.0299)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Urban</td><td align="left" valign="top" rowspan="1" colspan="1">0.0665<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0194)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0806<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0208)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0402<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0152)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Log Price Index</td><td align="left" valign="top" rowspan="1" colspan="1">0.458<xref ref-type="table-fn" rid="tfn3">a</xref> (0.161)</td><td align="left" valign="top" rowspan="1" colspan="1">0.177 (0.137)</td><td align="left" valign="top" rowspan="1" colspan="1">0.746<xref ref-type="table-fn" rid="tfn3">a</xref> (0.104)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Midwest</td><td align="left" valign="top" rowspan="1" colspan="1">0.0274 (0.0365)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0552<sup>c</sup> (0.0327)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0140 (0.0267)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">South</td><td align="left" valign="top" rowspan="1" colspan="1">0.198<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0352)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0654<sup>b</sup> (0.0310)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0257 (0.0245)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">West</td><td align="left" valign="top" rowspan="1" colspan="1">0.0540<xref ref-type="table-fn" rid="tfn5">c</xref> (0.0312)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0272 (0.0254)</td><td align="left" valign="top" rowspan="1" colspan="1">−0.0748<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0214)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Year</td><td align="left" valign="top" rowspan="1" colspan="1">0.0360<xref ref-type="table-fn" rid="tfn5">c</xref> (0.0186)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0424<xref ref-type="table-fn" rid="tfn3">a</xref> (0.0161)</td><td align="left" valign="top" rowspan="1" colspan="1">0.0141 (0.0129)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">Constant</td><td align="left" valign="top" rowspan="1" colspan="1">8.43<xref ref-type="table-fn" rid="tfn3">a</xref> (0.747)</td><td align="left" valign="top" rowspan="1" colspan="1">9.17<xref ref-type="table-fn" rid="tfn3">a</xref> (0.638)</td><td align="left" valign="top" rowspan="1" colspan="1">7.34<xref ref-type="table-fn" rid="tfn3">a</xref> (0.465)</td></tr><tr><td align="left" valign="top" rowspan="1" colspan="1">R<xref ref-type="fn" rid="fn2" /></td><td align="left" valign="top" rowspan="1" colspan="1">0.814</td><td align="left" valign="top" rowspan="1" colspan="1">0.868</td><td align="left" valign="top" rowspan="1" colspan="1">0.797</td></tr></tbody></table> </ephtml> </p> <p>Robust standard errors in parentheses.</p> <ulist> <item>3 a Significant at 1% level.</item> <item>4 b Significant at 5% level.</item> <item>5 c Significant at 10% level.</item> </ulist> <p>Research universities and schools with a higher proportion of students in the STEM, medical, and law areas are typically more comprehensive, and their increased complexity is reflected in the administrator pay. Both sets of variables are positively significant at the 1% level, with research designation having a greater statistical impact on provosts. Research designation and percent of the student body receiving STEM, medical, or law degrees also controls for the academic mix of the professors in traditionally higher-paying fields, which is borne out in the professor equation.</p> <p>A surprising finding is that having less restrictive admission policies, as reflected in a greater percentage of admits, significantly increases president compensation, even when total enrollment is controlled for. The estimated coefficient suggests a 10% rise in the admission rate would raise presidential pay 1.2%. If stricter admissions confers institutional prestige, presidents may be willing to trade off higher income for a more prestigious appointment. In economist's parlance, prestige results in a compensating pay differential.[<reflink idref="bib12" id="ref94">12</reflink>] We would expect the same affect to apply to the chief academic officer too. However, no such effect is found for provosts or professor pay. This is in contrast to [<reflink idref="bib42" id="ref95">42</reflink>] results of faculty receiving higher pay at institutions with more selective admissions standards.</p> <p>Turning to characteristics of the president and provost, female presidents receive approximately 4.8% less than their male counterparts and female provosts, 2.5% less. There is no statistically significant difference between the two. The president result is comparable to that found in earlier studies ([<reflink idref="bib39" id="ref96">39</reflink>]; [<reflink idref="bib11" id="ref97">11</reflink>]; [<reflink idref="bib28" id="ref98">28</reflink>]). Since presidents are often former provosts, it is interesting that the gender pay disparity begins early in administrator careers. The pay disparity is also evident in the professor equation, where a higher percentage of female faculty reduces average professor pay. Caution is warranted here in interpreting the result due to the nature of the data. The dependent variable is average full professor salary, while percent female pertains to all professorial ranks. Regardless, the calculated elasticity, or responsiveness, is small at −0.046. No statistically significant pay differences due to minority status were found in any equation.</p> <p>Consistent with results reported by [<reflink idref="bib28" id="ref99">28</reflink>], external hires are better compensated. Higher pay may be needed to attract outside candidates to apply if internal candidates are not readily identified. Increased compensation may be allocated to the position to entice more qualified candidates to risk moving to a new institution and incur the potential disruption to them or their family associated with moving. The coefficients of External in the president and provost equations are quite close, with both external presidents and provosts receiving between 6% and 7% higher pay. Conversely, presidents and provosts who are alums of their institution receive a 5% to 7% reduction in compensation. This may reflect a "hometown discount" where an alum is willing to accept less based on loyalty to, or familiarity with, their university.</p> <p>Administrator tenure does not factor into presidential pay but adversely affects provosts. Often the provost position is a stepping stone in an academic career culminating in becoming a president. A lack of upward mobility, reflected in a longer provost tenure, may indicate less opportunity or less ambition resulting in lower pay. A counter to this is the length of time the president and provost have worked together. Specifically, there is an average 2.0% pay boost in provost pay for each year they work together.</p> <p>While one can't directly control for how much faith a president places on their provost being their leading internal supporter, as suggested in the American Council on Education survey, this result could be picking up some of this potential relationship. A president is likely to retain an individual that advances their vision or demonstrates competence and may reward or incentivize their provost to remain in that role rather than seek more lucrative outside positions. This interpretation is strengthened in that it is only the provost and not the president who garners higher pay from a longer working relationship.</p> <p>Regarding the academic backgrounds of the president and provost, we do not find much difference between the academic fields. The coefficients relative to the excluded social sciences are mostly insignificant. One exception is that presidents with business degrees receive an 11% premium relative to most disciplines. This might reflect the demand for presidents with the business acumen to manage a university. Counter to this argument, presidents from the humanities receive higher pay relative to other disciplines albeit less than that for business.</p> <p>A responsibility of the board of trustees is to set the president's compensation. They are also likely to either set the provost's pay or approve the compensation negotiated between the president and provost. Funding for faculty pay raises is more apt to be set by the state legislature with the president and provost deciding its distribution (e.g., general raises, merit raises). As such, if the nature of the board affects faculty pay, it will be of an indirect nature, perhaps through lobbying the legislature. Our findings only reveal board effect on the president and provost. Schools overseen by an autonomous board of trustees pay significantly more than those that are part of a system. Presidents receive 8.7% higher compensation and provosts 6.6%. The difference is not statistically significant. The higher compensation is consistent with [<reflink idref="bib37" id="ref100">37</reflink>] findings that universities that moved from being in a system board to an autonomous board increased presidential pay. Trustees of autonomous boards may have a closer relationship with their administrators. Additionally, they needn't be concerned with pay equity issues where a system board is somewhat constrained in giving some administrators higher pay and not others. Faculty pay not being affected by the university having its own autonomous board is consistent with [<reflink idref="bib27" id="ref101">27</reflink>] result of instructional expenditures not being statistically impacted by the number of universities the board governs.</p> <p>In the corporate world, a larger board size is often associated with enhancing the power of the executive, which can lead to higher pay ([<reflink idref="bib26" id="ref102">26</reflink>]; [<reflink idref="bib49" id="ref103">49</reflink>]; [<reflink idref="bib9" id="ref104">9</reflink>]). Here we find no pay benefit to the president from a larger board.[<reflink idref="bib13" id="ref105">13</reflink>] A bit perplexing is that a larger board increases provost pay, although the impact is relatively small, with an elasticity of only 0.068. Neither the nature of the board nor its size were found to affect professor pay.</p> <p>Even where the university is autonomous, the trustees are typically appointed by the governor, legislature, or are elected. Alternatively, some trustees can be appointed by the board itself, alumni, faculty, students, or other groups. Given the often-political nature of government appointments, one might expect their greater board participation would lead to greater austerity in compensation. We find no evidence of this in any of the equations. Turning briefly to the remaining variables, for all three groups being in an urban area results in higher pay. This likely reflects a higher cost of living. Variations in state-price levels show up in the presidents and faculty equations, but not provosts. Even after controlling for state differences in cost of living, there is still a substantial premium for presidents of southern universities (20% relative to those in the Northeast) and a 5.4% premium in the West. Southern provost pay is also higher, but only by 7%, while Midwest pay sees about a 5.5% increase. For faculty, professor pay is 7% lower in Western states, but this is after controlling for the higher cost of living.</p> <hd id="AN0191107268-15">Summary and Concluding Remarks</hd> <p>In this study we have compared and contrasted factors affecting the compensation of public university presidents, provosts, and professors. Whereas the extant literature has focused on presidents and to a lesser degree faculty, provosts have been virtually ignored. This despite the provost typically being the number two university official and chief academic officer. Another key contribution of the paper was the inclusion of board governance variables to the compensation equations.</p> <p>Given we used the same institutional measures for faculty and administrators, comparisons of how environs influence both administrators and faculty pay was possible. With regard to presidents, most of our results mirror those found in earlier studies. These pertain to institutional characteristics such as size, resources, and mission. Our results suggest that in academic settings, a rising tide does lift all boats, or at least elevates the president, provost, and faculty collectively. Greater resources and enrollment have led to higher pay for all. We found no statistical differences in the effect of higher revenues among the groups, but the magnitude of the pay premiums associated with higher enrollment is only about one-third as large for faculty than that of the two administrators. Having a research-oriented mission resulted in a pay premium for all, with provosts benefitting the most. Larger university endowments had relatively small positive effects on president and provost pay, but not faculty.</p> <p>A key contribution of this paper was the inclusion of board governance variables to the compensation equations. Numerous studies in the corporate literature have explored the relationship between the corporate board and CEO pay. Higher CEO pay is often attributed to weaker governance. A major difference between corporate and academic governance is that each firm has its own distinct board, whereas a public university can either have its own governing board or be part of a Regent's system. An independent board may result in higher presidential pay because the president holds more sway than when a board oversees multiple institutions. Alternatively, boards tied to one university may engage in greater competition for prestige and offer higher compensation to attract more effective leadership. Our results indicate that presidents of self-governing universities earn nearly a 9% pay premium over those from Regent's schools. A similar boost is found for provosts; faculty receive no benefit. This may be due to boards having less ability to affect faculty pay, which is often directly set by state legislation. This role of the state was reflected in the result that universities relying more heavily on state appropriations had lower faculty salaries, whereas executive pay was unaffected.</p> <p>In the corporate literature, larger boards are subject to free-rider problems that can strengthen the executive leading to higher pay. We do not find any such effect on university presidents. We do find, however, a positive (albeit small) increase in provost pay as board size grows. This result is unexpected given that the board directly sets the president's pay. The result may be a statistical anomaly, or perhaps weaker board oversight allows the president to reward their provost. Expectations that having a larger proportion of government appointed members of a board would restrain compensation also did not bear out in the estimated results. This may be due to government-appointed trustees being a fairly diverse group (campaign donors, alumni, politicians) having different fiscal preferences. Or it may be an indication of market conditions favorable to presidents, or their representatives, negotiating rates of compensation that outweigh the preferences of elected officials.</p> <p>The president is the most visible leader to external constituents of the university. The provost largely deals with the internal workings of the university allocating budgets across programs as well as overseeing instruction, research standards, and the tenure and promotion of faculty. The provost may be viewed as an intermediary between the president and the faculty. If the provost is an extension of the faculty, their pay may reflect faculty pay. If presidents view the provost as the most favorable champion of advancing the mission of the university as indicated by the American Council of Education survey, the rewards of the president may be passed down to the provost. Our results suggest the factors that determine provost pay aligns more with the president than with the faculty.</p> <p>Prior studies have found that externally hired presidents earn more. We find the same is true for provosts with both groups receiving about 6% to 7% more than their internal counterparts. Presidents and provosts who are alumni receive approximately 6% less than non-alums. This suggests their affinity or loyalty towards their alma mater is taken advantage of in pay negotiations rather than being rewarded.</p> <p>Of particular interest is the connection between the president and provost in affecting provost pay. Ultimately, the provost serves at the pleasure of the president. A longer overlap of time together may indicate a more symbiotic relationship. Controlling for tenure, provosts receive on average 2% higher pay for each year the president's and provost's time together is extended. This result suggests there may be interpersonal dynamics at work that go beyond the institutional factors in determining provost compensation. A longer working relationship does not confer higher pay to the president. This is consistent with the president being able to reward the provost for loyalty or performance, rather than any joint productivity increase that also benefits the president when the board sets the president's pay.</p> <p>A weakness of our study is the inclusion of only two years of data. This was necessitated by the desire to bring attention to the previously neglected provost position. Much of the provost data, particularly compensation, is ephemeral in nature. It needs to be hand collected year by year to construct a longitudinal dataset.[<reflink idref="bib14" id="ref106">14</reflink>] A drawback of not having more years of data is that we are unable to detect if changes in institutional factors impact the trajectory of salaries comparably across university personnel. If data become available, it would be interesting to examine how compensation evolves as the president-provost relationship develops.</p> <p>For presidents, longitudinal studies do exist. It should be possible to incorporate data on the composition of the Board of Trustees to focus on how the president-board relationship develops and its effect on compensation salary raises. For instance, given that a longer working relationship between president and provost benefits the latter, does a board comprised of trustees with lengthier working relationships with their president lead to higher president compensation?</p> <p>An analysis by the National Education Association finds that since 2008, at least 32 states have decreased their spending on public colleges and universities. Furthermore, between 2020 and 2021 average state funding decreased by 1.3%, while faculty salaries took a larger hit with a 1.6% reduction, after adjusting for inflation. As state appropriations decrease, students and their families will be faced with higher costs of education (Flannery, 2023). It will be interesting to observe whether administrators will see their pay diminish or remain stagnant as faculty have already experienced. In July of 2023, West Virginia University's autonomous Board of Trustees granted a one-year extension of their president's contract in the midst of budget shortfalls and proposed cuts in staff and academic programs ([<reflink idref="bib41" id="ref107">41</reflink>]). The base salary of the president was not increased ([<reflink idref="bib30" id="ref108">30</reflink>]). While this is just one anecdotal case, further research into whether board structure and other aspects of governing boards impacts employment and compensation of administrators may be warranted. More specifically, as universities deal with shrinking budgets and changes in enrollment, it may be interesting to explore whether presidents (and perhaps provosts) experience more favorable outcomes when operating under an autonomous rather than a system board.</p> <ref id="AN0191107268-16"> <title> Notes </title> <blist> <bibl id="bib1" idref="ref5" type="bt">1</bibl> <bibtext> They omit Hawaii from their analysis.</bibtext> </blist> <blist> <bibl id="bib2" idref="ref12" type="bt">2</bibl> <bibtext> System schools often have their own Board of Trustees too, but these are advisory in nature rather than governmental.</bibtext> </blist> <blist> <bibl id="bib3" idref="ref16" type="bt">3</bibl> <bibtext> We use the term provost to refer to all chief academic officers. At some institutions, the title is Vice President for Academic Affairs.</bibtext> </blist> <blist> <bibl id="bib4" idref="ref20" type="bt">4</bibl> <bibtext> We included studies that are most comparable to ours, examining pay of presidents at US public universities. Studies that focused on private institutions, liberal arts colleges, and universities outside of the United States were omitted from the table.</bibtext> </blist> <blist> <bibl id="bib5" idref="ref24" type="bt">5</bibl> <bibtext> They acknowledge this as an issue of multi-collinearity in the estimation process.</bibtext> </blist> <blist> <bibl id="bib6" idref="ref43" type="bt">6</bibl> <bibtext> They also use the natural log of salaries plus benefits in some of their specifications.</bibtext> </blist> <blist> <bibl id="bib7" idref="ref57" type="bt">7</bibl> <bibtext> 46.8% of the sample presidents were from the <emph>Chronicle</emph>. For provosts, only 24.1%. <emph>The Chronicle of Higher Education</emph> online compensation database can be accessed at https://<ulink href="http://www.chronicle.com/article/president-pay-public-colleges/">www.chronicle.com/article/president-pay-public-colleges/</ulink>.</bibtext> </blist> <blist> <bibl id="bib8" idref="ref56" type="bt">8</bibl> <bibtext> In a 2019 article in Forbes, Nietzel reports the ratio of president pay-to-full professor salary at Forbes' 25 Top Public Colleges ranged from 2.6-to-1 at UCLA to 13.3-to-1 at Texas A&M. Neitzel argues compensation packages did not closely align to institutional reputation. While the ratios in academia are much smaller than in the corporate world, Nietzel questions whether university presidents are worth 13 times more than its senior faculty.</bibtext> </blist> <blist> <bibl id="bib9" idref="ref68" type="bt">9</bibl> <bibtext> Results were unaffected if minority was redefined to be African American only.</bibtext> </blist> <blist> <bibtext> While the result is statistically significant, the magnitude of the impact is fairly low or would be considered not very responsive in economics. In absolute terms, elasticities greater than 1 indicate an elastic (or relatively responsive) relationship, and those less than 1, inelastic (relatively unresponsive).</bibtext> </blist> <blist> <bibtext> When the dependent variable is expressed in log form and the independent variable is not, elasticity is calculated as the coefficient times the value of the independent variable. 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The impact of US News college rankings on the compensation of college and university presidents.. Research in Higher Education, 60, 1–17. https://doi.org/10.1007/s11162-018-9501-7</bibtext> </blist> <blist> <bibtext> To what degree are the determinants of compensation comparable for the president, provost, and faculty?</bibtext> </blist> <blist> <bibtext> Does a rising tide (e.g., greater resources, revenues, endowments) lift all boats in academic institutions, and if so, are the effects comparable across president, provost, and faculty?</bibtext> </blist> <blist> <bibtext> Does the nature of the board (e.g., size and degree of autonomy) affect administrator pay in ways consistent with the theoretical literature?</bibtext> </blist> <blist> <bibtext> Do provosts benefit from a longer working relationship with the president?</bibtext> </blist> </ref> <aug> <p>By Philip L. Hersch and Jodi E. Pelkowski</p> <p>Reported by Author; Author</p> <p></p> <p>PHILIP L. HERSCH, PhD, is an emeritus professor of economics at Wichita State University. His research encompasses a wide range of areas including corporate and university governance, public economics, and economics of sports.</p> <p>JODI E. PELKOWSKI, PhD, is an associate professor of economics at Wichita State University. 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  Data: Compensation of Presidents, Provosts, and Professors at US Public Universities
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  Data: <searchLink fieldCode="AR" term="%22Philip+L%2E+Hersch%22">Philip L. Hersch</searchLink><br /><searchLink fieldCode="AR" term="%22Jodi+E%2E+Pelkowski%22">Jodi E. Pelkowski</searchLink>
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  Data: <searchLink fieldCode="SO" term="%22Journal+of+Education+Human+Resources%22"><i>Journal of Education Human Resources</i></searchLink>. 2026 44(1):205-232.
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  Data: University of Toronto Press. 5201 Dufferin Street, Toronto, ON M3H 5T8, Canada. Tel: 416-667-7810; Fax: 800-221-9985; Fax: 416-667-7881; e-mail: journals@utpress.utoronco.ca; Web site: https://www.utpjournals.press/loi/jehr
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  Data: 28
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  Data: 2026
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  Data: Journal Articles<br />Reports - Research
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  Label: Education Level
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  Data: <searchLink fieldCode="EL" term="%22Higher+Education%22">Higher Education</searchLink><br /><searchLink fieldCode="EL" term="%22Postsecondary+Education%22">Postsecondary Education</searchLink>
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  Label: Descriptors
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  Data: <searchLink fieldCode="DE" term="%22Public+Colleges%22">Public Colleges</searchLink><br /><searchLink fieldCode="DE" term="%22Administrators%22">Administrators</searchLink><br /><searchLink fieldCode="DE" term="%22Presidents%22">Presidents</searchLink><br /><searchLink fieldCode="DE" term="%22Faculty%22">Faculty</searchLink><br /><searchLink fieldCode="DE" term="%22Salaries%22">Salaries</searchLink><br /><searchLink fieldCode="DE" term="%22Institutional+Characteristics%22">Institutional Characteristics</searchLink><br /><searchLink fieldCode="DE" term="%22Board+Administrator+Relationship%22">Board Administrator Relationship</searchLink><br /><searchLink fieldCode="DE" term="%22Boards+of+Education%22">Boards of Education</searchLink><br /><searchLink fieldCode="DE" term="%22Academic+Rank+%28Professional%29%22">Academic Rank (Professional)</searchLink><br /><searchLink fieldCode="DE" term="%22Educational+Finance%22">Educational Finance</searchLink><br /><searchLink fieldCode="DE" term="%22Salary+Wage+Differentials%22">Salary Wage Differentials</searchLink><br /><searchLink fieldCode="DE" term="%22Individual+Characteristics%22">Individual Characteristics</searchLink><br /><searchLink fieldCode="DE" term="%22Compensation+%28Remuneration%29%22">Compensation (Remuneration)</searchLink>
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  Data: 10.3138/jehr-2023-0045
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  Label: ISSN
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  Data: 2562-783X
– Name: Abstract
  Label: Abstract
  Group: Ab
  Data: While very generous compensation packages in the corporate world have become the norm, there is growing criticism of large compensation plans for administrators at universities. We examine compensation of presidents based upon individual characteristics and institutional features of US public universities. Unlike previous research, we also consider the potential influence of the nature of the governing board. Using the method of Seemingly Unrelated Regressions, we use the same framework to estimate president, provost, and average professor salaries. This enables us to directly compare the factors driving compensation for each. Many of the institutional and individual characteristics impact the pay of university administrators and faculty similarly. We find associations and interactions matter in compensation of administrators. Presidents and provosts who have a prior connection with the university (internal hires and alums) are paid less than their counterparts. Provosts with a longer overlap of tenure with the president benefit from higher salaries than their peers. Presidents and provosts serving at universities with an autonomous rather than systemwide board enjoy higher compensation, but there is no benefit to faculty. While greater revenues and enrollment leads to more pay for everyone, faculty rewards of higher enrollment are smaller in magnitude. Personnel expenditures account for the largest percentage of a university's budget. A better understanding of the factors that affect compensation, particularly administrator pay, may become increasingly important as public criticism of university spending and the cost of higher education intensifies.
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  Data: 2026
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        Value: 10.3138/jehr-2023-0045
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      – Text: English
    PhysicalDescription:
      Pagination:
        PageCount: 28
        StartPage: 205
    Subjects:
      – SubjectFull: Public Colleges
        Type: general
      – SubjectFull: Administrators
        Type: general
      – SubjectFull: Presidents
        Type: general
      – SubjectFull: Faculty
        Type: general
      – SubjectFull: Salaries
        Type: general
      – SubjectFull: Institutional Characteristics
        Type: general
      – SubjectFull: Board Administrator Relationship
        Type: general
      – SubjectFull: Boards of Education
        Type: general
      – SubjectFull: Academic Rank (Professional)
        Type: general
      – SubjectFull: Educational Finance
        Type: general
      – SubjectFull: Salary Wage Differentials
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      – SubjectFull: Individual Characteristics
        Type: general
      – SubjectFull: Compensation (Remuneration)
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      – TitleFull: Compensation of Presidents, Provosts, and Professors at US Public Universities
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