University fights peers for top-notch scholars

Three years ago Princeton University tried to recruit Finance professor Franklin Allen to join its economics department. Flattered that another elite institution was interested in his scholarship, he seriously entertained their offer.

However, after a yearlong trial period at Princeton, Allen decided that in the end, Penn was the place for him.

"A lot of it came down to academic decisions," Allen said, explaining that although Princeton has an outstanding economics department, it has less of a tradition in finance -- a subject which Penn holds in high regard.

The other side of his decision was personal; with his wife and two sons involved with Penn and having spent more than 20 years at the University, leaving became a difficult proposition.

Allen's situation is a common one among senior faculty at Penn and other top-tier institutions. Although secure in tenured positions, many face appealing offers from outside schools vying for their scholarship and expertise.

As a result, universities have to constantly fight to retain their own faculty while simultaneously trying to lure top-notch scholars away from their peers. Such market-style competition keeps deans and department chairs on their toes.

For a Penn department like Psychology, retention of faculty members is a concern that recurs almost yearly, Psychology Department Chairman Robert DeRubeis said.

"The [retention] effort involves finding what the faculty member would like [to] see change about their environment. That could include [increases in] salary, space, [or] it could include other kinds of resources," DeRubeis said, explaining that at other times retention requires building up a specific area of the department by hiring other faculty members for collaboration purposes.

And although the University is often successful in retaining its scholars, there are numerous instances in which outside offers have been attractive enough to lure a faculty member away.

Associate Provost Janice Bellace noted that 10 to 15 years ago, the University experienced heavy losses in the field of entrepreneurship, when scholars in that area were in high demand.

Penn and other schools feel additional pressure when one of their peers makes a big commitment.

Bellace noted that at the moment, New York University has the resources to create numerous new endowed chair positions after a large fundraising effort.

In a number of fields, demand for scholars can come not only from other universities, but from the private sector as well.

"Where there is an outside market, the University has to bid higher to keep good people in academics [in areas like] science and economics," History Department Chairman Sheldon Hackney said. "Most academics understand that."

It is widely accepted that an offer from another university is one of the best ways -- other than a natural promotion like receiving tenure -- for a professor to get a salary increase, and there is some concern that such a market-style system creates salary inequities.

"In the past, there have been times when a department did respond to someone's outside offer and then did virtually nothing for other persons of equal merit in the department," Bellace said. "That becomes a very difficult situation because others become either demoralized or angry."

However, Bellace maintained that deans and department heads try their best to maintain equity within each department so that comparable scholars, whether or not they are being recruited from the outside, receive comparable salaries.

And others agree that the system, however imperfect, works reasonably well in the end.

"It is understood that people who get offers from the outside will get a somewhat higher salary ... but the difference shrinks over time," DeRubeis said.

Although there are certainly rewards for playing the game, there are certain risks that come with receiving an outside offer.

"One has to be very careful," Hackney said. "Your chairman might say, 'Congratulations, we will keep up with your career' -- You have to be ready to go if you are going to play the game that way ... because the University might not be willing to do anything special to keep you."

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