SUMMARY
The use of person-specific data for economists across all types of public academic institutions provides several insights into the academic wage equation for economists. First, this study confirms the alignment of the academic incentive structure with the underlying value of scholarship in an academic institution, i.e. scholarship pays off. Interestingly, though, the richness of this data set allows for a better understanding of that payoff. For while economists at doctoral granting institutions earn more on average than their counterparts at non-doctoral granting institutions, the marginal benefit for additional publications is higher for those economists at non-doctoral granting institutions.Most importantly, the study validates the recent findings of Binder et al. (2012) that the incentive structure at academic institutions imposes a teaching tax. Whether at doctoral or non-doctoral granting institutions, the marginal cost of teaching undergraduates is significant although there is a positive return to award-winning teaching. Thus, despite the inherent educational mission of the Academy, this study supports the ironic conclusion teaching imposes a tax on the academic economist.