[Excerpt] American colleges and universities are increasingly substituting non-tenure track full-time and part-time faculty for full-time tenured and tenure track faculty. Moreover, institutions of public higher education, where almost two-thirds of the full-time faculty members at four-year institutions are employed, are under severe financial pressure. The share of state budgets devoted to public higher education is declining. The salaries of economics department faculty members at public higher education institutions have fallen substantially relative to the salaries of their counterparts at private higher education institutions and it is becoming increasingly difficult for the publics to compete for top faculty in economics. Moreover, it is at the economics departments in public institutions where the greatest increase in the usage of non-tenure track faculty has also occurred. This article begins by presenting levels of Ph.D. production, and then discusses factors determining demand for economics departments, differences between public and private universities, and the range of pay between departments within universities.