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    "To summarize how academia works..." Well, maybe this describe certain field. I don't know, but this is not universally applicable.
    – Timmy
    Commented Apr 17 at 2:27
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    "good grad students want, among other things, an institution that will confer them prestige, a good advisor, and a stable salary with low teaching load." replace good with smart: the low teaching load is a pre-requisite because future positions may require "teaching experience" and smart students want to have done 1 hour of teaching load over 4 years so they can say "I have it!" without lying ...
    – EarlGrey
    Commented Apr 17 at 7:48
  • "University administrators want the big-grant-getting professors for the overhead benefits of the grant." - this is kinda backwards. The big PIs cost a lot of money to attract, so you front-load the investment, and then you are hoping that you will get a payoff, by maybe breaking even with indirect cost payments from grants. Large PIs often subsidize for the lack of payoff from less productive PIs. At some point, the bills have to get paid for all of this--tuition is already high and it's not enough. Facilities cost a fortune, and it's expensive to pay for necessary administration. Commented Apr 18 at 2:36