In American academics, professors in certain fields make significantly more than professors in other fields. Here salaries are usually correlated with the salaries paid in the private (non-academic) sector. Outside of America, on the other hand, it is often the case that all assistant professors are paid (roughly) the same, and all full professors are paid (roughly) the same, independent of one's field. That's only fair, right? If the history prof and the engineering prof both have to teach and conduct research, why should the engineering prof earn more?
New Zealand is one such country in which academic salaries are independent of one's field. Using data from New Zealand universities, Glenn Boyle shows that if you don't pay the engineering prof more, the quality of engineering research will fall. This is because the best engineers will find it more attractive to accept high-paying private sector jobs. Academic research productivity in different fields depends the how a field's academic salary compares to salaries outside of academia. This suggests that if academic economists earn the same as English professors, the best economists will find it even more attractive to accept a high-paying job on Wall Street, and the quality of economics research will fall. A similar effect isn't present for English professors because they don't have as high-paying of outside options.
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