Diversity, Endowments and Inclusion: Pay-for-Performance and Gender Differences in University Presidents Base Salaries

Abstract

This study investigates gender disparities in base salaries among university presidents, focusing on how endowment levels affect gender-based pay-for-performance differences. Pay-for-performance links compensation to performance outcomes. Using ordinary least-squares, quantile regression, and the Generalized Linear Model, we analyze data from 422 colleges and universities. Results show that while endowment sizes for male and female presidents are similar, an additional $1 billion increases female presidents' average base salary by 10%, with little to no impact on male presidents' salaries. This financial sensitivity may lead female presidents to avoid financial risks and suggests they may face different financial expectations than their male counterparts. Control variables allow for examining gender pay disparities across six institutional categories, linking president salaries to institutional diversity, high-potential women pay premiums, operational scale economies, teaching and research trade-offs, and wage optimization.