CMER WORKING PAPER No. 07-56
Extending the literature on monopsony in academic labor markets, we find that faculty pay is inversely related to seniority in both cross-sectional and longitudinal data sets for a large public university in the United States. Fixed-effects results indicate that the negative relationship cannot be explained by lower quality of senior faculty. Arguing that mobility costs are higher when both partners work for the same university, we allow monopsony power to vary by employment status of partner. We find that pay of male faculty is negatively and significantly related to the number of years the partner has been employed by the university and that the penalty is greater when couples are hired together.