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Abstract:
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Academic salary compression occurs when professors of one professorial rank earn salaries close to-or even higher than-salaries of more senior faculty. We analyze data on faculty salaries from 1993-2015 for 15 disciplines to see which disciplines have been most affected by salary compression. We calculate and analyze mean-based compression ratios and explore stochastic dominance relationships between estimated Dagum salary distributions. Although academic salary compression is not seen in most disciplines, it is common in business-related fields, has been increasing in these disciplines, and exhibits examples of stochastic dominance. Also, salary compression increases as competing nonacademic salaries increase.
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