4 ms·

The problem with pay transparency starts with the problem of determining compensation itself. If compensation could be a direct output of an algorithm that was

The problem with pay transparency starts with the problem of determining compensation itself. If compensation could be a direct output of an algorithm that was highly accurate based on attributes of an individual that highly predict their market worth, pay transparency works well because people could agree that this person is being paid fairly. Also, if everyones pay could be dynamically determined it would help too. Basically, people get hired and get their salary set. Then new people are being recruited and market dynamics may have changed and now maybe a higher salary is required to attract this candidate. I'm not being very articulate here, but i'd say the problem with pay transparency isn't the transparency part, but the actual process of determining fair/market-clearing wages for employees.

abtinf 9y ago
> If compensation could be a direct output of an algorithm ... people could agree that this person is being paid fairly Nope. Then they would start accusing the algorithm of being racist, sexist, otherist. They would cite institutional bias - bias so pervasive everyone has it even while no individuals do - and demand the algorithm be tweaked for their favored lobbyists. The problem with pay transparency is not that it doesn't work; the problem is that the entire concept is immoral and evil. How much money you make is, properly, strictly a conversation between the parties in the transaction. No one else should care about your income; they should focus on maximizing their own value and find those for whom their services are the most valuable. The kinds of benefits valuable to an individual are unique: everyone has a different in background, life choices, purpose, and capability. There is no way to account for the fact that person A values work that involves travel, while person B is interested in work with a predictable schedule; and it is improper for person B to look at person A's compensation and make judgements about their own compensation, not because it is impossible to analyze all of the factors, but because person B must decide their own purpose and work toward it. This is simply another manifestation of the inequality debate. Equal is Unfair is a great book that unpacks the issues of inequality: https://www.amazon.com/Equal-Unfair-Americas-Misguided-Inequality/dp/125008444X https://www.amazon.com/Equal-Unfair-Americas-Misguided-Inequ...
- 09094920394314 9y ago
  >The problem with pay transparency is not that it doesn't work; the problem is that the entire concept is immoral and evil. How much money you make is, properly, strictly a conversation between the parties in the transaction. so how does this differ from any other good/transaction where we DO share prices? Why is it not immoral and evil that I can compare prices between amazon and walmart? All the problem you describe can be resolved by employers either justifying themselves to their employees like adults, paying more, or the employees quitting. All of which are free market actions, the first of which having the added bonus of humanising the relationship. The only downside: you can't just treat your employees like "human resources" and get away with it as easily. You need to treat them as people
  - abtinf 9y ago
    The difference is that every individual is unique in their ability to create value and their compensation preferences. A product on Amazon has a market price - the thing being exchanged is an objective, metaphysical fact and people assign it a value. In areas of labor where the uniqueness of individuals is less of a factor, you will generally find that pay transparency is the norm. This is often unskilled/low-skilled labor in jobs that cannot offer meaningful non-pecuniary compensation. But most people do not work in such jobs, and even in most manual labor jobs there is a strong element of applying your mind to do good work. As such, your purpose as an individual is much more important. Pay transparency detrimental to you, as an individual. To live a happy life, you must figure out your own purpose and use your mind to achieve it. Happiness is not the result of income, nor is money required to be happy. Your happiness is a function of the achievement of the values you have defined for yourself. If you allow the income of others to influence your decision making, you are only hurting yourself. You should not leave a job that is satisfying in its essentials - that is, it fits with your purpose, you do meaningful work - merely because you discover someone else makes more; that would only hurt you. You don't know - can't know - their purpose, their value, their preferences, that lead to their income and work environment.
    - 09094920394314 9y ago
ejnulls 9y ago
Yes, I've been thinking a lot about value the last few months and this is similar to the conclusion I reached. No one is paid based on the value of their output because it is nigh impossible to actually determine for most people! So we use a proxy for value that is much more closely tied to an employee's leverage in the market place. Does your profession have a government granted monopoly (law/medicine)? Certification to entry? Are you a better negotiator? Do you have another higher job offer? Do you have personal relationships with a business's customers (sales)? All of these things are correlated with increased leverage and thus increased compensation. Output is largely not. It may set a ceiling for compensation, but it is not as related to compensation as a persons' leverage. And it follows that people with high amounts of leverage and comparatively low amounts of output will be "screwed" by salary transparency. They will have to justify why their leverage is worth more than someone else's output and that will make them unhappy.

abtinf 9y ago

> If compensation could be a direct output of an algorithm ... people could agree that this person is being paid fairly Nope. Then they would start accusing the algorithm of being racist, sexist, otherist. They would cite institutional bias - bias so pervasive everyone has it even while no individuals do - and demand the algorithm be tweaked for their favored lobbyists. The problem with pay transparency is not that it doesn't work; the problem is that the entire concept is immoral and evil. How much money you make is, properly, strictly a conversation between the parties in the transaction. No one else should care about your income; they should focus on maximizing their own value and find those for whom their services are the most valuable. The kinds of benefits valuable to an individual are unique: everyone has a different in background, life choices, purpose, and capability. There is no way to account for the fact that person A values work that involves travel, while person B is interested in work with a predictable schedule; and it is improper for person B to look at person A's compensation and make judgements about their own compensation, not because it is impossible to analyze all of the factors, but because person B must decide their own purpose and work toward it. This is simply another manifestation of the inequality debate. Equal is Unfair is a great book that unpacks the issues of inequality: https://www.amazon.com/Equal-Unfair-Americas-Misguided-Inequality/dp/125008444X https://www.amazon.com/Equal-Unfair-Americas-Misguided-Inequ...

09094920394314 9y ago
>The problem with pay transparency is not that it doesn't work; the problem is that the entire concept is immoral and evil. How much money you make is, properly, strictly a conversation between the parties in the transaction. so how does this differ from any other good/transaction where we DO share prices? Why is it not immoral and evil that I can compare prices between amazon and walmart? All the problem you describe can be resolved by employers either justifying themselves to their employees like adults, paying more, or the employees quitting. All of which are free market actions, the first of which having the added bonus of humanising the relationship. The only downside: you can't just treat your employees like "human resources" and get away with it as easily. You need to treat them as people
- abtinf 9y ago
  The difference is that every individual is unique in their ability to create value and their compensation preferences. A product on Amazon has a market price - the thing being exchanged is an objective, metaphysical fact and people assign it a value. In areas of labor where the uniqueness of individuals is less of a factor, you will generally find that pay transparency is the norm. This is often unskilled/low-skilled labor in jobs that cannot offer meaningful non-pecuniary compensation. But most people do not work in such jobs, and even in most manual labor jobs there is a strong element of applying your mind to do good work. As such, your purpose as an individual is much more important. Pay transparency detrimental to you, as an individual. To live a happy life, you must figure out your own purpose and use your mind to achieve it. Happiness is not the result of income, nor is money required to be happy. Your happiness is a function of the achievement of the values you have defined for yourself. If you allow the income of others to influence your decision making, you are only hurting yourself. You should not leave a job that is satisfying in its essentials - that is, it fits with your purpose, you do meaningful work - merely because you discover someone else makes more; that would only hurt you. You don't know - can't know - their purpose, their value, their preferences, that lead to their income and work environment.
  - 09094920394314 9y ago

ejnulls 9y ago

Yes, I've been thinking a lot about value the last few months and this is similar to the conclusion I reached. No one is paid based on the value of their output because it is nigh impossible to actually determine for most people! So we use a proxy for value that is much more closely tied to an employee's leverage in the market place. Does your profession have a government granted monopoly (law/medicine)? Certification to entry? Are you a better negotiator? Do you have another higher job offer? Do you have personal relationships with a business's customers (sales)? All of these things are correlated with increased leverage and thus increased compensation. Output is largely not. It may set a ceiling for compensation, but it is not as related to compensation as a persons' leverage. And it follows that people with high amounts of leverage and comparatively low amounts of output will be "screwed" by salary transparency. They will have to justify why their leverage is worth more than someone else's output and that will make them unhappy.