alt Hacker NewsThat theory rests on the assumption that your salary is based on how good you are at your job. But if that were the case then corporate life wouldn't be full of people complaining "my boss is an idiot and yet (s)he makes ten times what I do".
I'll argue that money goes to those who are best at internal politics, with perhaps a moderate correlation with work performance.
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I'm pro salary transparency, but both things are true and OP should not be downvoted:
- Some employee salary discrepancies are inefficiencies due to humans sucking at rationally evaluating other people
- Some employee salary discrepancies are legitimate outcomes of value produced relative to other employees
The problem is the more we create policy assuming the first one is true, we eliminate everyone in the second category (however small or large that category), making the economy less efficient. I would argue pay transparency isn't one of those policies however, and in fact would lead to more efficiencies.
That said, all interventions have consequences, and less growth and higher inefficiency from cutting tall poppies is indeed a risk. As someone in Europe, our total lack of productivity growth is leading to collapsing governments, underwater social entitlement systems and mass riots. These are serious issues that should be discussed and not dismissed outright with downvotes.
> perhaps a moderate correlation with work performance
The only time I have seen a correlation greater than 0 is where bonuses where directly linked to earnings or sales ... even then the correlation was not 1