High end universities regularly mark up most expenses charged to research grants by about 75%. This is the result of negotiations between the university and the

High end universities regularly mark up most expenses charged to research grants by about 75%. This is the result of negotiations between the university and the government. Nongovernmental grantors will sometimes negotiate much lower overhead. I suspect the negotiation goes “here’s $1M to a prestigious professor, and you may not touch it. We’ll give you $100k to make you feel better. Take it or leave it. By the way, if you leave it, we will happily offer the same research group $1M if they pack their bags and move to a different university.” Wise professors with grants with differing overhead schedules will, of course, allocate charges to minimize the university’s cut.