Professors and hamburgers: an international comparison of real academic salaries

In recent years, academic staff unions and associations have argued for higher salaries for academics on the grounds that existing salaries have not kept pace with inflation, are well below commercial salaries and, most glaringly, are much lower than the salaries of their overseas counterparts. Howe...

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Bibliographic Details
Published in:Applied economics 2000-06, Vol.32 (7), p.869-876
Main Authors: Ong, Li Lian, Mitchell, Jason D.
Format: Article
Language:English
Subjects:
Academic profession
Applied economics
Comparative analysis
Departments
Exchange rates
Industrialized nations
International
Policy making
Purchasing power
Purchasing power parity
Quality of life
Studies
Teachers
Trade unions
Wage negotiations
Wages
Wages & salaries
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Summary:In recent years, academic staff unions and associations have argued for higher salaries for academics on the grounds that existing salaries have not kept pace with inflation, are well below commercial salaries and, most glaringly, are much lower than the salaries of their overseas counterparts. However, most international comparisons are made based on exchange rate conversions, which is inappropriate since purchasing power differentials are only reflected in exchange rates in the long term. Furthermore, the volatility of exchange rates make such conversions highly inaccurate. A comparison is provided of real academic salaries by converting the nominal salaries in each country to their purchasing power equivalents, using the Big Mac Index. Our results show that real academic salaries are highest in Hong Kong and Singapore, relative to the developed countries, while Hong Kong tax and social security deductions are lowest. Furthermore, real salary levels, combined with intrinsic considerations such as the quality-of-life, indicate that Canada and New Zealand are unattractive places for visiting/migrating academics, while Australia and the USA are relatively attractive. It is suggested that these findings could be of use to policy-makers and academic unions in salary negotiations, as well as academics making relocation decisions.
ISSN:0003-6846
1466-4283
DOI:10.1080/000368400322200