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Are College Presidents Like Football Coaches? Evidence From Their Employment Contracts, Randall Thomas, Lawrence R. Van Horn
Are College Presidents Like Football Coaches? Evidence From Their Employment Contracts, Randall Thomas, Lawrence R. Van Horn
Vanderbilt Law School Faculty Publications
College presidents and football coaches are frequently criticized for their high compensation. In this paper, we argue that these criticisms are unmerited, as the markets for both college presidents and football coaches exhibit properties consistent with a competitive labor market. Both parties compensation varies in sensible ways related to the size of the programs they manage, as well as their potential for value creation. Successful college presidents and football coaches can greatly increase the value of their schools well beyond the amount they receive in compensation. If these higher education executives' compensation is the result of a competitive labor market, …
College Football Coaches' Pay And Contracts: Are They Overpaid And Unduly Privileged?, Randall S. Thomas, R. Lawrence Van Horn
College Football Coaches' Pay And Contracts: Are They Overpaid And Unduly Privileged?, Randall S. Thomas, R. Lawrence Van Horn
Vanderbilt Law School Faculty Publications
College football coaches' employment contracts and compensation garner public attention and scrutiny in much the same way as those of corporate CEOs. In both cases, the public perception is that they must be overpaid and pampered Economic theory claims that for coaches and CEOs to be overpaid, they must be receiving compensation in excess of the value they create for their organizations. However, both receive pay-for-performance compensation, which structurally aligns their compensation with value creation. This means we need to examine the underlying structure of the contract that gives rise to the observed compensation to determine whether they are appropriately …