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I have a theory that most people in the US are overpaid. However the overpayment is a strategy by management so that they themselves can be even more overpaid.
by dlwdlw 9y ago
I have a theory that most people in the US are overpaid. However the overpayment is a strategy by management so that they themselves can be even more overpaid. This can be afforded because the overpaid people are locked into middle class life scripts driving up cost of living (houses) so that they are still reliant on the jobs. It's potential "fuck u" money but isn't because of the attractive force of a domain and resistance to change. (ironically the same arguments some techies deride locals for for not moving some place cheaper)
There is excessive profit taking at all levels including the IC level, however market dynamics actually create greater and greater differences in wealth despite the trickle down.
- Terr_ 9y agoIf most people are "overpaid", why have wages dropped relative to productivity for decades?
- 36bydesign 9y agoI have a theory that facts don’t matter
- Terr_ 9y ago"Strange, yet symbolically compelling."
- a3n 9y agoI have a theory that most people in the US do not work in SV-like jobs.
- thehardsphere 9y agoYour theory is not based upon sound economics. If everyone was colluding in the way you describe to pay themselves more, then a situation would emerge where companies that didn't comply with this conspiracy would be significantly more profitable than those that did. Note that, although managers may wish to throw money around because it's not theirs, shareholders view every penny spent on salaries as an expense that eats into their profits. They have an incentive to insist on lower employee salaries whenever possible, and they're typically the ones who make the rules in most firms. Also, if situations like that could exist, you wouldn't only see them in the US.
- tensor 9y agoApparently Apple pays less than average for silicon valley: http://bgr.com/2016/01/04/steve-jobs-answer-apple-engineer-salary/ http://bgr.com/2016/01/04/steve-jobs-answer-apple-engineer-s...
- mercutio2 9y agoDid you read that story to the end? There’s a bunch of editorializing not backed up by the actual details. Who do you think knew more about compensation at Apple, Steve Jobs, or the random employee? Or perhaps your argument is Steve Jobs was just lying?
- lmm 9y agoOn the contrary, it's mainstream economics that a lot of internal corporate decisions are made for the welfare of employees/managers rather than shareholders.
- thehardsphere 9y agoSure, that's an example of principal/agent problems. Those happen all the time and are very real. But to claim that, there would be a vast conspiracy tobtake all of that money on a wide enough scale to make everyone in the USA overpaid is where the thing breaks down.
- lmm 9y agoNot one vast conspiracy. Just many people in similar positions with similar incentives acting in similar ways.