Lately there has been a lot of buzz in the blogosphere on the associate-partner "pay gap" (Jeff Lipshaw, titled "The Days of Whine and Roses"), the application of Marxist economic theory to corporate law firms (David Luban), and what all the huge salaries and profits augur for the future of legal profession and legal education (Brian Tamanaha).
All of it is worth reading, especially Tamanaha's insights on the growing fissure between elite and nonelite law schools. (For a scholarly treatment of this topic, see Randolph Jonakait, The Two Hemispheres of Legal Education and the Rise and Fall of Local Law Schools, NYLS L Rev (forthcoming 2007)).
David Zaring and I recently posted our "Young Associates in Trouble" essay, which provides some new empirical evidence on the BigLaw tournament. The essay reviews two recent novels that portray elite law firms (one in DC, the other in London) as an unending marathon of boring and substantively unfulfilling work. In turn, we compare these fictitious accounts with findings from a unique dataset based on the AmLaw Midlevel Survey, which includes questionnaire responses from several thousand 3rd, 4th, and 5th year associates.
So what is the key takeaway? As shown in the table below, virtually every principle of enlightened management and social responsibility is either (a) associated with lower firm profits, or (b) irrelevant to the bottomline.
The essay also includes some multivariate regression models that reveal that firms actually make more money when associates work on less interesting work or report a greater likelihood of leaving the firm within the next two years. In contrast, family friendliness, training and guidance, and feedback appear to have no effect on profits.
More empirics and another graph after the jump.