Research in Higher Education, Vol. 38, No.

3,1997

SHOULD FACULTY RANK BE INCLUDED AS A

PREDICTORVARIABLESTUDIESIN STUDIES OF GENDER
EQUITY IN UNIVERSITY FACULTY SALARIES?

Nancy Boudreau, James Sullivan, William Balzer,

Ann Marie Ryan, Robert Yonker, Todd Thorsteinson,
and Peter Hutchinson

Many different approaches, almost ail of which use some form of regression, have
been used to study the issue of gender equity in university faculty salaries. One major
point of contention in ail of these approaches is whether faculty rank, which is univer-
sity conferred, should be included as a predictor variable. Two illustrations are pre-
sented to demonstrate how omitting faculty rank as a predictor variable from gender
equity studies of university faculty salaries can lead to incorrect conclusions concern-
ing gender discrimination. The first illustration uses hypothetical data constructed so
that there is no difference in salary due to gender. However, when faculty rank is not
included as a predictor variable in the regression model, there is a significant differ-
ence in salary due to gender. The second illustration uses actual data from a study of
gender equity in pay at Bowling Green State University. This data set is used to con-
struct a new data set that is totally free of gender bias. When a regression model omit-
ting faculty rank is fit to this gender bias-free data, again a significant difference in
salary due to gender is present. Therefore, it is recommended that faculty rank be in-
cluded as a predictor variable in any model used to study gender equity relating to
salary.

Gender equity in faculty salaries is a volatile and controversial issue on college

and university campuses. The presence of discrimination in faculty salary due to
gender (or race, ethnicity, age, religion, etc.) is both illegal and abhorrent, and re-
flects negatively on the institution and its faculty. Specifically, evidence of salary
discrimination against women as a class may lower faculty morale and create ten-
sion between male and female faculty, undermine faculty (and perhaps student)
recruiting efforts, and challenge the perceptions of the university's culture as sup-

Nancy Boudreau, lames Sullivan, William Balzer, Ann Marie Ryan, Robert Yonker, Todd
Thorsteinson, and Peter Hutchinson, Bowling Green State University. Address correspondence to:
Nancy S, Boudreau, Department of Applied Statistics and Operations Research, Bowling Green State
University, Bowling Green, OH 43403.

297
036l-OM5/97rt>600-0297SI2.50m © 1997 Human Sciences Press, Inc.
298 BOUDREAUETAL

portive of disadvantaged groups. It is therefore important to investigate all allega-

tions of discrimination in pay. If these allegations are well founded, it is incum-
bent on the university to redress this discrimination despite the high financial
costs that may be associated with the remedy (e.g., salary adjustments and back
pay to affected class members). In a more proactive manner, institutions should
provide appropriate training to individuals involved in salary decisions (e.g.,
deans, department chairs, and departmental salary committees) and regularly
monitor faculty salaries to identify and address any problems before they occur.
One major point of contention in determining whether there is gender inequity
in faculty salaries is the evidence necessary to determine whether it exists or not.
For example, several different approaches and methods, almost all of which use
some form of multiple regression, have been proposed to test for gender discrim-
ination. Gray and Scott's (1980) salary kit approach develops a regression model
using data from only male faculty, and this model is then used to predict female
salaries; discrimination would be inferred if residuals (i.e., differences between
actual female faculty salaries and their predicted salaries using the male salary
model) are large and negative. Oaxaca's (1973) method assesses gender discrim-
ination in pay by decomposing the difference between male and female faculty
salaries into two separate components: (1) wage differences attributed to differ-
ences in human capital characteristics between males and females (e.g., years of
experience) and (2) wage discrimination; a statistical test can be conducted to de-
termine whether these differences are statistically significant. Cohen and Cohen
(1983) propose the use of hierarchical regression that uses a multistep process to
build a model to predict faculty salaries, incorporating appropriate predictors that
are theoretically or conceptually believed to influence salary; discrimination
would be evidenced by a statistically significant contribution of an inappropriate
predictor (e.g., gender) added subsequent to the development of the rational
salary model. Although arguments can be made for the benefit of one particular
approach over the other, one generally finds that similar conclusions, given the
same data, are reached regardless of which particular approach is used (Balzer et
al., 1995; Moore, 1993).
Conclusions regarding the presence or absence of gender discrimination do dif-
fer, however, depending on the particular variables or factors that are included in
the model to predict salary. Many predictor variables have been used in faculty
gender equity studies, including faculty members' years at the institution (e.g.,
Bereman and Scott, 1991; Schau and Heyward, 1987), years since receipt of high-
est degree (e.g., Regan, 1990; Smart, 1991), highest degree (e.g., Baker et al,
1988; Ervin, Thomas, and Zey-Ferrell, 1984), possession of terminal degree (e.g.,
Chasin, Goldfarb, and LaNoue, 1989; Johnson, Riggs, and Downey, 1987), age
(e.g., Danielson and Smith, 1981; Swartzman, Seligman, and McClelland, 1992),
years in current rank (e.g., Lassiter, 1983; Schau and Heyward, 1987), faculty
productivity (e.g., Ervin, Thomas, and Zey-Ferrell, 1984; Raymond, Sesnowitz,
and Williams, 1988), and so on (for reviews, see Balzer et al., 1995; Moore,
FACULTY RANK IN STUDIES OF GENDER EQUITY 289

1993). The research literature is replete with debates around the conceptual or op-
erational definition of these predictor variables (e.g., the use of possession of the
terminal degree versus possession of the doctorate; Lassiter, 1983; Raymond,
Sesnowitz, and Williams, 1993; Riggs et al., 1986; Simpson and Rosenthal,
1982). By far the most controversial point in gender equity studies in higher edu-
cation, however, is whether to include faculty rank as a predictor of salary (Gray,
1985; Barrett and Sansonetti, 1988).
The primary goal of this paper is to demonstrate how the omission of faculty
rank as a predictor variable from a gender equity study of faculty salary can lead
to incorrect conclusions regarding gender discrimination. A brief overview of the
arguments for or against the inclusion of faculty rank in a salary model is pre-
sented followed by two demonstrations, the first using hypothetical salary data
and the second using actual salary data, supporting the inclusion of faculty rank
as a predictor of salary.

FACULTY RANK AS A PREDICTOR OF FACULTY SALARY

The inclusion or exclusion of faculty rank and related variables (e.g., years in
rank) from the salary model has been shown to have a large impact on whether
findings from a faculty salary study will be consistent or inconsistent with the hy-
pothesis that there is gender discrimination in salary (Balzer et al., 1995). Rank
has consistently been shown to be the single best predictor of salary (Osbome,
1990; Raymond, Sesnowitz, and Williams, 1988; Stacy, 1983).

Conceptual Importance of Faculty Rank in Determining Salary

Conceptually faculty rank is an extremely important determinant of faculty
salaries. Therefore, the debate regarding its inclusion or exclusion from salary
models used to analyze gender equity in faculty salaries is crucial. At most uni-
versities faculty rank influences salary in two ways: first, the initial salary level is
determined based on the rank at the time of appointment; second, promotion in
rank often carries a continuing stipend added to current salary.
Descriptions of the "rank at hire" and promotion processes extant at the au-
thors' institution, Bowling Green State University, can illustrate these points. At
the point of hire the initial rank and salary range are advertised based on national
market data in specific disciplines. Most probationary (i.e., tenure track) appoint-
ments are made at the entry level at a rank of assistant professor with a salary rep-
resentative of the national market in which the institution competes. Some nego-
tiation between candidates and the contracting officer (dean) might be expected.
Less frequently more senior faculty may be hired at the associate professor and
professor ranks. Salary ranges are advertised in these cases as well based on gen-
eral market conditions within the particular discipline. Negotiations between can-
didates and the contracting officer are more likely in these situations based on in-
300 BOUDREAU ETAL.

dividual candidates' credentials than would be expected at the entry assistant pro-
fessor level.
In some cases a candidate is hired prior to completion of all degree require-
ments (usually "all but dissertation"). In some of these cases the initial rank is
specified as instructor with a salary commensurately lower than what would be
paid to a candidate who has completed the terminal degree. Language in the letter
of appointment specifies a date when all degree requirements must be satisfied.
Completion of requirements causes the contract to convert automatically to the
assistant professor level with a specified salary increase; failure to complete de-
gree requirements by the specified date results in termination.
The other method through which rank is determined, and through which rank
affects salary, is the promotion process. Only probationary or tenured faculty are
eligible for consideration for promotion. The promotion process involves an in-
tensive review of the candidate's credentials and recommendations by the aca-
demic department, department chair, college review committee, dean, and vice
president for academic affairs. If promotion recommendations are accepted by the
president and the board of trustees, promotions in rank are accorded to faculty ac-
companied by permanent stipends added to their salaries, each rank having its
own specified salary increment.

Rationale for the Exclusion of Faculty Rank

The primary argument for excluding rank as a predictor variable in studies of
gender discrimination in pay is that rank is a university-awarded recognition that
may be awarded in a discriminatory fashion by the institution (e.g., Forber and
Green, 1982; Scott, 1977). That is, individuals or committees responsible for pro-
motion decisions (e,g., college deans or provosts, college- or university-wide pro-
motion committees) may intentionally or, more likely, unintentionally discrimi-
nate against women faculty when one examines either the promotion process
(e.g., require different or higher standards for female faculty than for male fac-
ulty) or promotion outcomes (e.g., promote a smaller proportion of female than
male faculty or require longer time at rank for female than male faculty before
consideration for promotion). Some possible reasons for this bias may be the
overrepresentation of biased male administrators and faculty in the institution's
promotional system or a climate that fails to support female faculty during their
careers (e.g., more limited access to research support, inadequate mentoring by
senior faculty, more onerous teaching assignments).
If gender discrimination in salary exists at an institution, including a gender-bi-
ased predictor such as faculty rank in a regression model would produce a smaller
difference between male and female salaries than is actually present. For exam-
ple, suppose there are two faculty members from the same department, one male
and one female, with the same credentials (i.e., years of experience, terminal de-
gree, years at the institution, etc.). The male faculty member has been properly
FACULTY RANK IN STUDIES OF GENDER EQUITY 301

promoted to full professor while the female has not. In addition, suppose the
yearly salary increases for the male have been higher than those for the female
(salary discrimination). Thus, the only differences in the set of predictor variables
for these two faculty members are rank and gender. The female is at a lower rank
than she should be, but her salary will be relatively high for that rank. Had she
been properly promoted, her salary would be lower than that of her male counter-
part because of the discrimination in yearly raises. If rank is included as a predic-
tor variable in the regression model, the magnitude of this difference in salary
will not appear as large as it really is. This could possibly lead to the conclusion
that no gender difference in salary exists when it really does.
In summary, excluding rank as a predictor of faculty salary is based on the ar-
gument that both rank and salary decisions by the university carry the same po-
tential for bias, and a salary model with rank included may underestimate salary
bias due to gender (Moore, 1993). For this reason, the "salary kit" method en-
dorsed by the American Association of University Professors recommends that
faculty rank should not be included in the model testing gender discrimination in
faculty pay (Gray, 1990; Gray and Scott, 1980; Scott, 1977).

Rationale for the Inclusion of Faculty Rank

Several authors have directly challenged the argument by Gray and colleagues
(Gray, 1990; Gray and Scott, 1980; Scott, 1977) that because bias may exist in
promotion decisions, faculty rank should not be included as a predictor of faculty
salary. Recent reviews of court cases have concluded that rank should be included
in the absence of evidence of discrimination in promotion practices (Barrett and
Sansonetti, 1988; Fogel, 1986). Fogel (1986) argues strongly that rank must be
included because gender discrimination in pay is limited to differences within Job
level; that is, it makes no more sense to lump full and assistant professors into the
same job level at universities as it would to lump supervisory and nonsupervisory
employees in the private sector, police sergeants and lieutenants in the public sec-
tor, and so forth. Fogel states that rank therefore must be included in a faculty
salary study (i.e., salary discrimination), and any concerns about discrimination
regarding rank appointments (i.e., promotion discrimination) should be addressed
in a separate study. It may be that salary is awarded without regard to gender but
promotion to higher rank is gender biased. If this is the case, then discrimination
related to this gender-biased factor should be remediated, and salary will reflect
this remediation.
The position advocated by Fogel (1986) is consistent with others who note that
tests should be conducted to determine whether in fact there is bias in either the
promotional process or promotional outcomes at an institution rather than assum-
ing its presence or absence (Balzer et al., 1995; Barrett and Sansonetti, 1988;
Moore, 1993). Many university-based case studies of pay discrimination have in-
302 BOUDREAUETAL.

eluded rank only after an analysis of whether or not rank was gender biased
(Ervin, Thomas, and Zey-Ferrell, 1984; Swartzman, Seligman, and McClelland,
1992; Riggs et al., 1986). For example, Riggs et al. (1986) and Swartzman et al.
(1992) used discriminant function analysis to test for gender biases in rank.
Another approach, used by Lassiter (1983), sorted faculty members by sex, pos-
session of terminal degree, years since terminal degree, and years of college ex-
perience, and conducted chi-square analyses to test for differences between male
and female faculty members. As might be expected, however, there is some de-
bate on what methods and criteria should be used to assess gender discrimination
in faculty rank:

The problem of what constitutes a proper study of whether rank is sex-linked embraces
not only the question of differential promotion rates but also that of whether initial ap-
pointments of similarly qualified men and women are made at different ranks. While no
definitive guide for such analysis exists, it is clear that simply looking at the outcome of
the decision on those actually considered for promotion is not enough. (Gray and Scott,
1980, p. 176)

A second argument for including faculty rank in faculty salary studies is that
omitting important predictor variables from salary studies may result in an under-
specified model, which makes it difficult to correctly interpret the salary model.
Specifically, if a meaningful predictor variable has been left oat of a salary
model, the effect of this predictor on the dependent variable is often shifted inap-
propriately to other predictors that have been included in the model, leading one
to underestimate the influence of the omitted predictor and overestimate the in-
fluence of those related and included predictor variables. Faculty rank has been
shown to be the single best predictor of salary (Osborne, 1990; Raymond, Ses-
nowitz, and Williams, 1988; Stacy, 1983).
Finally, Stacy and Holland (1984) argue that rank is often an important ex-
planatory variable for salary disparities between male and female faculty. There
are usually differences in the number of male and female faculty members at
higher ranks at universities, which may simply reflect the greater availability of
males in the applicant pool several decades ago. If one ignores these differences
in distribution of males and females across ranks, gender difference in salary (I.e.,
combining ail ranks, the average salary of female faculty was 82% of that for
males) was approximately double the actual difference observed when rank was
taken into account (i.e., female full, associate, and assistant professors averaged
90%, 95%, and 95% of the salaries of their male counterparts, respectively).
Moore's (1993) review of salary equity studies found that rank was included in
every case she examined. University-based case studies of salary discrimination
typically included rank (e.g,, Bergman and Scott, 1991; Damelson and Smith,
1981; Fisher, Motowidlo, and Werner, 1993; Raymond, Sesnowite, and Williams,
1988; Baker etal., 1988; Schau and Heyword, 1987).
FACULTY RANK IN STUDIES OF GENDER EQUITY 303

Summary
The weight of the evidence reviewed above suggests that it is both reasonable
and appropriate to include rank as a predictor to study gender equity in salary.
However, it would be prudent to support the inclusion of rank with an accom-
panying study to evaluate the presence or absence of discrimination in obtaining
faculty rank through promotion. Thus, in gender equity studies relating to salary
there are really two questions to be answered: "Are faculty members at the ap-
propriate ranks?" and "Is there a difference in salary due to gender?"

DEMONSTRATING THE SPURIOUS INFLUENCE OF GENDER ON

SALARY WHEN RANK IS OMITTED FROM THE SALARY MODEL
In general, assistant professors earn less than full professors. In situations
where there are different proportions of males and females at different faculty
rank, the omission of rank from a salary model may indicate an apparent gender
difference in salary when, in fact, this finding is due to underspecifieation of the
salary model. Two examples are presented to demonstrate this phenomenon. The
first example uses hypothetical data constructed to illustrate the point. The second
example is based on actual data from a study of gender equity in pay conducted at
Bowling Green State University (BGSU).

Illustration 1: A Simple Example

Suppose it is desired to predict salary with only two predictor variables: gender
(female versus male) and rank (for simplicity of illustration, full versus assistant
professor). The data in Table 1 include 10 female (two and eight full and assistant
professors, respectively) and 10 male (eight and two full and assistant professors,
respectively) faculty: Let us assume that based on a promotion study it has been
determined that all faculty are at the appropriate rank.
The data in Table 1 were constructed such that the average salary for female
full professors ($60K) is exactly equal to the average salary for male full profes-
sors. Similarly, the average salary for female assistant professors ($36K) is ex-
actly equal to the average salary for male assistant professors. Now, suppose it is
desired to create a model to predict salary and it is decided to exclude rank from
the model because it might be biased. Using the one remaining variable, gender,
to predict salary, the parameter estimate for gender of —$14,400 (i.e., the
difference between the average salary of females collapsing across ranks and the
average salary of males collapsing across ranks) is statistically significant,
<(18) = —2.57, p = .019. However, in this data set, there is BO gender difference
in salary: the average female assistant professor salary is the same as the average
304 BOUDREAU ET AL.

TABLE 1. Hypothetical Data Used to Demonstrate the Need to Include Rank in a

Salary Model

Rank
Assistant Professor Full Professor Marginal
Gender (code = 0) (code = 0) Means
Male $40K $32K $70k $70K
Faculty $64K $64K S55.2K
(code = 0) $56K $56k
$50K $50K
(cell mean $36K) (cell mean $60k)
Female $46K $46K $56K $64K
Faculty $40K $40K S40.8K
(code = 1) $32K S32K
$26K $26K
(cell mean $36K) (cell mean $60k)1
Marginal $36K $60k $60k
Means

male assistant professor salary and the average female full professor salary is the
same as the average male full professor salary. This "gender difference" occurs
because an important predictor variable related to salary, that is, rank, has been
omitted from die model. If rank and gender are both included in the model, the
parameter estimate for rank of $24,000 (i.e., the difference between the average
salaries for full and assistant professors) is statistically significant, t(17) = 5.62,
p = .000, and the parameter estimate for gender of $0 (Le., the difference between
the average salaries of female and male faculty members) is not statistically sig-
nificant, 1(17) = 0, p as l.o. Finally, if gender, rank, and the interaction between
gender and rank are included in the model, the parameter estimate for rank of
$24,000 is again significant while the parameter estimates for gender of $0 and
gender by rank of $0 are nonsignificant.
Now, suppose that systematic discrimination is introduced by reducing each fe-
male faculty salary $ 10K. Using only gender to predict salary, the parameter esti-
mate for gender is now -$24,400 (i.e., the difference between the average salary
of females collapsing across ranks after the $10K was subtracted and the average
salary of males collapsing across ranks) and is statistically significant, t(18) =
-4.35, p = .000. When both rank and gender are included in the model, the pa-
rameter estimate for rank of $24,000 (i.e., the difference between the average
salaries for full and assistant professors within each sex) is statistically signifi-
cant, *(17) = 5.62, p = .000, and the parameter estimate for gender of -$10,000
(i.e., the difference between the average salaries of female and male faculty mem-
bers within each rank) is statistically significant, t(17) = -2.34,p = .032. This pa-
FACULTY RANK IN STUDIES OF GENDER EQUITY 305

rameter estimate for gender reflects the systematic discrimination that was intro-
duced into the data.
In conclusion, the first simple hypothetical example demonstrates that by ex-
cluding from the salary model an important predictor variable such as faculty
rank that is highly related to salary, gender can appear to have a significant impact
on salary when, in fact, it does not. This leads one to draw an inappropriate con-
clusion about the presence of gender discrimination in salary. However, if sys-
tematic discrimination does exist, the inclusion of rank does not cover up the true
gender difference.

Illustration 2: Case Study

To evaluate whether omitting an important predictor variable such as rank f-om
a salary model leads to inappropriate conclusions regarding gender discrimina-
tion in pay, a database that is totally free of gender bias in salaries is needed.
Because it might be very difficult to find (or agree on) such a database, one can bo;
created. First, a database is needed that contains both male and female data. The
male data alone are then used to develop a regression model to predict faculty
salary. Since only male data would be used, there could be no gender bias in this
model. Next, this fitted model is used to predict the salaries of the female faculty
in the database using the values of the actual female predictor variables. These
predicted female salaries are free of gender bias by definition because they are
predicted from a salary model based only on male data. Conceptually, they mea-
sure predicted female salaries if females were compensated according to the male
salary model. Now, the actual female salaries in the original database are replaced
with these predicted female salaries.
One assumption necessary for regression analyses to be valid is that the ran-
dom error term must have constant variance. Because of the way the gender
bias-free database was created, this assumption is probably violated. All the fe-
male salaries lie on the fined surface, while the male salaries are scattered above
and below the fitted surface. Thus, the male salaries contain random error, while
the female salaries do not. If nonconstant variance is present, statistical tests
could indicate no significant relationship exists between a predictor variable and
the dependent variable when a relationship actually exists.
To alleviate this problem, a normally distributed random error term with the
same standard deviation as the residuals from the male salary model is added to
the female salaries predicted from the male model. The total database is then de-
fined as the original database with the actual female salaries replaced with the
predicted female salaries from the male model plus random error. In this data-
base, both male and female salaries contain random error.
This new database is, by definition and construction, free of gender differences
in salaries, because the salaries of the female faculty are what would be expected
if females were paid using the same salary model as their male counterparts. If the
306 BOUDREAU ETAL.

male salary model including gender is now fit to this new database, the parameter
estimate for gender would be close to zero (it would be exactly zero if no random
error term were added). Thus, is this modified database, the salary for each fac-
ulty member is equal to what he or she would be paid if everyone were paid ac-
cording to the male salary model.
The above procedure was used with the 1993-94 Faculty Salary Base at BGSU
to create a gender bias-free database that was then used to evaluate the necessity
of including rank in BGSU's salary model. This database contained a total of 511
male and 214 female faculty members. The proportions of male and female fac-
ulty members at the different faculty ranks were quite different (91% of the full
professors were males, 74% of the associate professors were males, 56% of the
assistant professors were males, and 36% of the instructors/lecturers were males).
A promotion study was also done to make sure faculty were at the appropriate
ranks.

Step 1: Develop Male Salary Model

To develop the regression model based only on the male data, the following
procedures were followed. Fkst, all predictor variables1 that were thought to be
related to salary were put in the model. These variables included years of prior
experience (PRIOREXP), years at BGSU (YRBG), years in current rank
(YRRANK), rank (coded as dummy variables Rl, R2, R4), possession of termi-
nal degree (TERMDEG), previous administrative experience (ADMIN), eminent
scholar status (EMINENT), graduate faculty status (GRADFAC), salary factor
(SALFAC),2 and campus status (FIRELAND) (main campus versus branch cam-
pus). All continuous variables were centered to reduce multicollinearity problems
between the original and squared predictor variables (Aiken and West, 1991;
Neter, Wasserman, and Kutner, 1989). Because there were no clear expectations
about the set of predictor variables that would have curvilinear or interactive in-
fluences on the prediction of salary, a stepwise procedure was used to determine
any significant two-way interactions and curvilinear terms involving the above
variables that would improve the model. The best model using only the male data
included all the predictor variables and 14 two-way interaction terms. The ad-
justed R2 value was .836, indicating a fairly good fit (Table 2).

Step 2: Predict Female Salaries Using Male Model

This fitted regression model based on male data was men used to predict the
salaries of the female faculty using the actual values of the female predictor vari-
ables. The actual female salaries were then replaced with the predicted salaries
based on the male regression line plus a random error term, creating a gender
bias-free database. The random error terms were generated using a standard nor-
mal random number generator and multiplying the results by the estimate of the
standard deviation derived from the fitted regression model based on male data,
FACULTY RANK IN STUDIES OF GENDER EQUITY 307

TABLE 2. Best Model Using Male Salary Data Only

Parameter Standard
Variable Estimate Error P VIF
INTERCEPT 40835.00 1782.49 0.000 0.00
PRIOREXP 671.77 175.13 0.001 12.57
YRBG -153.22 95.81 0.110 15.06
Rl 16875.00 1375.33 0.000 7.59
R2 7087.51 957.72 0.000 3.33
R4 -11691.00 1992.10 0.000 3.64
YRRANK 484.48 141.97 0.001 17.38
TERMDEG -2019.97 1661.13 0.225 3.23
SALFAC 15208.00 4264.17 0.000 6.89
GRADFAC 1965.59 845.24 0.021 2.11
ADMIN -2068.66 1845.05 0.263 1.92
EMINENT 27340.00 3908.10 0.000 1.48
FIRELAND 4459.36 2365.66 0.060 4.65
PRIOREXP*YRBG -84.10 17.42 0.000 10.60
PRIOREXP*R1 700.98 137.71 0.000 4.41
PRIOREXP*YRRANK 63.50 21.16 0.003 7.64
PRIOREXP*SALFAC -1523.31 391.21 0.000 1.19
YRBG*YRRANK -20.11 6.06 0.001 3.15
YRBG*SALFAC -1126.72 192.76 0.000 1.25
R1*YRRANK 768.26 141.04 0.000 6.98
R2*YRRANK 318.35 121.62 0.009 4.42
R4*TERMDEG 7408.07 3189.90 0.021 1.64
R4*SALFAC -19681.00 7905.44 0.013 1.76
YRRANK*ADMIN 883.05 201.34 0.000 1.51
TERMDEG*FIRELAND -5582.57 2731.43 0.042 4.66
SALFAC*GRADFAC 17868.00 4675.65 0.000 6.38
ADMIN*FIRELAND 26447.00 6183.44 0.000 1.24
F" 10U84,p = 0.000
AdjR2 = 0.836
W=511
s = 5547.16

5,547.16. The resulting random error terms are from a normal distribution with a
mean of zero and a standard deviation of 5,547.16.3

Step 3: Develop Salary Model on Bias-free Database

A salary model was then developed for this modified, "gender bias-free" data-
base, excluding rank and years in rank (Table 3). A four-step process was used to
develop this model. The four steps include (1) identification of all linear relations
between predictor variables and the dependent variable, (2) identification of any
308 BOUDREAU ET AL.

TABLE 3. Best Model Using Actual Male Salaries and Female Salaries Predicted

from the Male Regression Line Plus Random Error with GENDER and
Ail Significant Interactions Involving GENDER Added
(Omitting Rank and Years in Rank)

Parameter Standard
Variable Estimate Error P
INTERCEPT 36788.21 852.27 0.000
PRIOREXP 108.91 123.74 0.379
YRBG 819.65 49.32 0.000
TERMDEG 6447.79 1009.96 0.000
SALFAC 11901.08 3416.40 0.001
GRADFAC 7333.61 775.87 0.000
ADMIN 8141.68 1739.21 0.000
EMINENT 40945.44 4309.77 0.000
FIRELAND 446.31 1365.81 0.744
PRIOR*GRADFAC 646.20 142.03 0.000
YRBG*GRADFAC 148.87 59.36 0.012
SALFAC*GRADFAC 26436.73 3987.90 0.000
ADMIN*FIRELAND 23688.23 5470.57 0.000
GENDER -1642.86 636.70 0.010
F= 176.35, p = 0.000
AdjR2 = 0.759
N =725
s = 7055.75

statistically significant two-way interaction and curvilinear terms, excluding gen-

der, (3) the addition of gender to the model, and (4) the addition of any significant
interaction terms involving gender to the salary model. The find model using this
modified database indicates a statistically significant negative parameter estimate
for gender (p =.010). The parameter estimate of gender, —$1,642.86, indicates
that female faculty would be underpaid (compared to male faculty) an average of
approximately $1,643. However, because this database was by definition a "gen-
der bias-free" database, no gender bias in salary exists in the database. By ex-
cluding rank and years in rank from die salary model in a clearly "gender
bias-free" database, the model incorrectly attributes to gender a bias that is by de-
finition not present. Thus, omitting rank and years in rank from the study of gen-
der discrimination in salary at BGSU results in the erroneous conclusion that gen-
der bias in salary exists when it does not. When rank and years in rank were
included in the development of the model in Step 3, neither gender nor any gen-
der interactions were significant
Now, suppose that systematic discrimination is introduced into this "gender
bias-free" database by reducing each female faculty salary by $1,200 (approxi-
FACULTY RANK IN STUDIES OF GENDER EQUITY 309

mately 2.5% of the overall average faculty salary). The male salary model (that
includes rank and years in rank) including gender was then fit to this new "gen-
der-biased" database. The parameter estimate for gender is —$1,102 and is statis-
tically significant, f(697) = -2.128, p = .033 (it is not equal to -$1,200 because
the random error term was added). Thus, if gender bias does exist in the data set,
including rank and years in rank will not cover up this true difference. These ad-
ditional analyses, then, reaffirm that rank should be included in a salary model.
Although we used hierarchical multiple regression to demonstrate the need to
include faculty rank in models used to determine if gender bias exists in faculty
salaries, this is by no means the only way to analyze the data. Other methods such
as path analysis or structural equations could also be used.

CONCLUSION
If gender inequity exists in faculty salaries, it may be due to one or both of two
types of discrimination. First, female faculty may not be at the appropriate rank.
Second, even if female faculty are at the appropriate rank, a difference in salary
may exist. A promotion study needs to be done to determine if female faculty are
at the appropriate rank. Faculty rank needs to be included in a salary model to
even hope to uncover the second type of discrimination.
Two illustrations were presented to demonstrate how the omission of faculty
rank from faculty salary models could lead to the inappropriate conclusion that
gender inequity in salaries exists when it does not. In both examples, the propor-
tions of males and females at various faculty ranks are different. If the propor-
tions of males and females across ranks are similar, leaving rank out of the model
would probably not affect the significance or nonsigniflcance of gender. It could,
however, affect other model characteristics such as the model variance and the Rz
value of the model. Thus, it is recommended that faculty rank be included as a
predictor variable in any model used to study gender equity relating to salary. In
addition, it is also recommended that any gender equity study of salaries that in-
clude rank be accompanied by a promotion study. When bias in the awarding of
rank is found, such bias should be appropriately remedied.
The issues discussed in this paper may generalize to other situations where al-
legations of discrimination in salary are made. For example, a similar logic and
rationale could be applied concerning discrimination in faculty salary due to race.
If the proportions of minority and nonminority faculty members differ at the dif-
ferent faculty ranks, omitting rank from the model could lead to an inappropriate
conclusion regarding discrimination in salary due to race.
Because the issue of salary equity is so important, much care should be taken in
conducting salary equity studies. A thorough understanding of the effects of omit-
ting important predictor variables is needed by those who undertake such studies.
310 BOUDREAU ET AL.

NOTES
1. The following variables were used in the regression models:

PRIOREXP— Prior experience, found by subtracting the years at BGSU from the years since
highest degree
YRBG — Years at BGSU
YRRANK — Years in current rank
Rl — Rl = 1 if full professor, 0 if not
R2 — R2 = 1 if associate professor, 0 if not
R4 — R4 = 1 if instructor or lecturer, 0 if not
TERMDEG— TERMDEG = 1 if possess terminal degree in field, 0 if not
ADMIN — ADMIN = 1 if held a prior administrative appointment at BGSU other than de-
partment chair or was hired into university as department chair or school director,
0 if not
EMINENT — EMINENT = 1 if currently appointed as eminent scholar, 0 if not
GRA0FAC— GRADFAC= 1 if member of graduate faculty, 0 if not
FIRELAND— FIRELAND = 1 if appointment on Firelands campus, 0 if not
SALFAC — Measure of external market factor
GENDER — GENDER = 1 if female, 0 if not

2. The external market salary factor (SALFAC) was found using the 1993/94 national salary data pro-
vided by the National Association of State Universities and Land Grant Colleges (NASULGC).
Survey respondents included 77 of the 93 NASULGC institutions with at least five different doc-
toral programs. Because BGSU is a NASULGC institution, respondents in this survey represent a
reasonable set of peer institutions. SALFAC represents, for a given discipline/major field, the ra-
tio of the national average academic-year salary of full-time faculty for that discipline/major field
to the average academic year salary for full-time faculty of all disciplines/major fields. Since the
classification scheme used by NASULGC was too broad to accurately represent all specialty areas
within the College of Business Administration, salary data gathered in the same manner by the
American Assembly of Collegiate Schools of Business (AACSB) from university business
schools were used.
3. The male salary model plus gender was fit to this new "gender bias-free" database. The resulting
parameter estimate for gender, 97.82, is close to zero and is not statistically significant, ?{697) =
0.189, p = .850.

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Received September 25,1995.