https://www.chicagobusiness.com/education/how-uchicago-deploying-enormous-gift-griffin
Interesting article - with some interesting stats (top econ faculty can make $400k/yr). Even with interest from the gift yielding ~$8M a year, will it STILL be hard to keep pace with Harvard, Stanford et. al.?
The race at the top is fierce.
Thank you for posting the link to the article.
I am no longer on top of current research in economics. But if my experience in the 1980’s is any indicator, I don’t think we need to care about USNWR says about U of C Economics Department.
A lot of U of C Economics Nobel Laureates had been treated with disdain and despise in the past 4 decades. From Milton Friedman Permanent Income Hypothesis and Monetarism, Gary Becker Human Capital and Economics interpretation of Sociology, Gene Fama Efficient Market Hypothesis, Robert Lucas Theory of Rational Expectation and all the way up to Richard Thaler Behavioral Economics, Chicago School of Economics is never about being popular but being rigorously analytical. The downside is that the scholars have to have tough skin against ridicule from the main stream (especially East Coast) establishment. If you go back to 1970’s and 1980’s, I doubt too many “experts” would give high marks to Lucas, Sargent, Hansen as compared to the dinosaurs like Tobin or Solow. Who get the last laughs now?
That said, $125 million will pay a lot of salary for TA, RA and other professional support as well as offering competitive compensation to both accomplished and aspiring scholars. Ultimately, what U of C attracts other star quality faculty is not just money but more about the research atmosphere. Booth just hired a MacArthur genius from Harvard to become an University Professor.
"University Professors are selected for internationally recognized eminence in their fields as well as for their potential for high impact across the University. Only twenty-two members of the University of Chicago faculty have received this honor. This includes Gary Stanley Becker, American Economist, Professor of Economics and Sociology at the University of Chicago and the Booth School of Business, and winner of both the Nobel Memorial Prize in Economic Sciences (1992) and the United States Presidential Medal of Freedom (2007). Today nine faculty members hold the University Professor title. "
By my estimate, a Booth School Finance Professor makes between $350,000 and $400,000. An endowed chair probably will push it over $500,000. And that is not counting any outside consulting
In contrast, the normal full professor salary at U of C is “only” $212,000. Obviously if you are James Heckman or Roger Myerson you get paid a whole lot more. Heckman at 74 is still very active in research and was recently in Hong Kong delivering a keynote address at a forum about youth and creativity. You bet that he was not doing that for free. However, as distinguished as the faculty at the Department of Economics is, not everyone has a Nobel Prize (although it may sound that way 
) or an endowed chair. Assistant Professor salary is typically around $86,000. I would bet the $125 million will go a long way to attract promising young faculty and budding star by throwing in some extra research grant.
A good example for picking a rising star is Professor Lars Peter Hansen. First a disclaimer: I don’t understand his work. Generalized Methods of Moments is way beyond my grasp of econometrics. Still from what I gather Hansen is widely respected for his seminal contribution to the field.
Hansen got his PhD from U of Minnesota at 1978. In those days, the U of Minnesota department of Economics was the intellectual younger brother of U of C. Professor Sargent and Wallace there soldiered on along side of Professor Lucas in the advent of New Classical Economics. U of C grabbed Hansen from Carnegie Mellon in 1981 and Hansen has been at U of C ever since 1981. The investment paid off when Hansen was the co-recipient with Professors Fama and Shiller for the Nobel Prize in 2013.
In the final analysis, while the $125 million helps, assistant or associate professors don’t come to U of C just for the extra $20,000 pa. It is the research atmosphere, the workshop and the philosophy of the department altogether that attract a future Nobel winner.
Speaking of… and a bit out of topic.
UChicago used to be good at picking off underappreciated professors in other universities and in other disciplines that are not Econ.
UChicago should have offered Donna Strickland a chair before she got her Nobel in Physics. The university of Waterloo, where she works, kept her as Associate Professor despite her notable accomplishments.
I wonder if Strickland plans to stick around at Waterloo. I wonder if Waterloo at least has the decency to make her a full professor now that she has a Nobel. I wonder if Stanford will pirate her… they are known for having enough $ and the desire to hire Nobels after they get awarded.
Yitang Zhang was a lecturer at University of New Hampshire. After his groundbreaking paper on finite bounds in prime numbers, UNH immediately promoted him to full professor. But he was ready to move on. He literally could have picked any big name university but he eventually settled on UC Santa Barbara.
I think all the universities are trying to find their own diamond in the rough. But the success rate is usually very low.
From what I’ve read, Strickland only isn’t a full prof because she never bothered to apply to be one - you have to apply in Canada. There’s no pay raise associated with the title bump so there’s not as big of an incentive as there is in the US.