Raiding and Signaling in the Academic Labor Market by

Publications signal a professor’s productivity and may lead to raids by other universities. Professors attach different values to non-wage benefits at a raiding university, and will quit only if benefits elsewhere are relatively high. The social value of these benefits means research may increase welfare even without a direct social value from research. Other results are: welfare would be reduced if a university committed to not make counteroffers; signaling occurs even if its cost is independent of individual productivity; and a school may preempt signaling by paying a higher wage, but will only do so when signaling increases welfare. *Professor of Economics, Appalachian State University, Boone, NC 28608. E-mail: {[email protected]}. I particularly thank Todd Kendall for detailed comments on an earlier version of this paper. I also thank Kyung Baik, Don Parsons, and participants in a workshop at Appalachian State University for their comments. JEL classifications: D82, J44, J62