It was a down year for the top portfolio managers at Harvard Management, which invests the assets of the Harvard endowment. For example, David R. Mittleman took home about $18 million, down from $25.4 million last year. And Maurice Samuels got $16.9 million, a drop from last year's $25.3 million.

Such payouts get little debate on Wall Street, but in the halls of academia, they've drawn plenty of criticism. After all, isn't the mission of an educational institution to further knowledge, not fatten money managers' bank accounts? Shouldn't the professors -- who do important things like find cures for diseases -- get the big bucks?

Maybe so. And maybe the criticism is why some of those portfolio managers have moved on.

More on that in a moment. But I'm sure that if critics attended an Econ 101 class at Harvard, they would see that compensation is generally based on the easy concepts of supply and demand. After all, is a baseball player really worth $100 million? Perhaps not, but in a market economy, it can conceivably be the case.

In the money-management world, compensation is often based on performance. And the portfolio managers at Harvard Management have been outstanding: The Harvard endowment currently sits at a staggering $25.9 billion.

The management firm has consistently beaten out other endowments. Last year, for example, the team posted a return of 19.2%, while the median return of the 25 largest endowments was 15.8%.

On the face of it, a 3.4% difference may not seem inconsequential. But on a fund in excess of $20 billion, it can mean hundreds of millions more dollars for the school. Think that can help boost professors' salaries? Build new wings? Add new programs? Fund research? You bet.

So why deal with such criticism? Interestingly enough, five of the six top Harvard Management portfolio managers recently left to -- you guessed it -- start a hedge fund. With their superb track record, these managers had little trouble raising billions. And, no doubt, they likely will have a strong compensation package.

Here's the ultimate irony: One of the fund's investors is, well, the Harvard endowment, which kicked in $500 million.

The ultimate question, though is: How much is superior performance worth? Apparently a lot. The incumbent question that falls upon the average investor is whether -- in spite of salaries, management fees, and others -- a fund outperforms the overall market (more or less, the S&P). And if it does, you might say it's worth something like, say, $25 million.

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Fool contributor Tom Taulli can be reached at tom@taulli.com.