Executive compensation: the more pay leaders get, the meaner they get | Hacker News Reader

Executive compensation: the more pay leaders get, the meaner they get

blogs.hbr.org

35 pointsmcantelon11 comments

I am skeptical, since the conclusions so closely match what I'm sure a lot of people would like to believe.

There are many reasons to be skeptical about the claims the article is making. Correlation vs. causation, and the experiment's relation to executive compensation both seem obvious angles of attack. However, the fact that the study supports what some people would like to believe is not a good reason to doubt any study. Certainly there are some people who would like to believe executive compensation has no impact on how mean you are. Would you be just as skeptical of the reverse finding, based on the notion there are people out there who would like it to be true?

If an experiment's findings are bogus, it is because there is a problem with the methodology or execution. If you want to attack a study, attack it on that basis. If you can't point to a problem with the methodology/execution, your attack is at least as suspicious as that hint of confirmation bias.

You're confusing different levels of analysis. The comment you're replying to was speaking on a very broad scale: The result is suspicious. Because of that suspicion, we might then look more closely and identify all the issues you're talking about, but we need that first spark of skepticism to get there.

If this study was financed by the tobacco industry and claimed to have found that smoking was good for you, would you still remain completely agnostic as to the validity of the findings until you had thoroughly studied it?

This sounds like a twist on the Stanford prison experiment, I'm not really sure how this ties to real world executive compensation. (See http://en.wikipedia.org/wiki/Stanford_prison_experiment for reference)

> "It made me want to look at income disparity, power and moral disengagement. Does this income gap help the leaders to feel comfortable setting up policies that hurt the people at the bottom?"

An alternative hypothesis: Higher compensation can instill a sense of pressure that makes a person more on edge, stressed, and curt with people, regardless if you're an engineer or a manager or something else.

I've got anecdotes both ways, but generally speaking, whenever I've been working on something with lots of pressure or higher compensation, I've noticed myself being unintentionally more on edge and a little shorter with people. The best example I can think of off the top of my head - I spoke at a few conferences from I think '06 to '08. I always tried to be really nice to all the staffers and volunteers there, assistants, everyone making it happen. I remember how when someone who was slightly important was nice to me I always remembered that and felt good, and made a big effort to do so.

Largest conference I ever spoke at my hands were shaking bad before I went to speak. Actually, my hands regularly shook before public speaking, I broke a water glass like this once. But this time it was bad. Someone came to chat with me, and I just said, "N-n-n-not now. Sorry. Later. Maybe later." I tried to mumble out something about having the shakes but it didn't come across really well.

Now I'm comfortable admitting I've got the shakes before speaking and I fight through it by acknowledging it and fighting through it. But how many people push that inwards? The result comes out, you get shorter with people.

So I think the author came in with a perceived notion - executive compensation might lead to meanness. Then she picked metrics that would indicate an atmosphere of intense pressure and labeled these signs of "meanness" - whereas maybe cause and effect runs the other way? Maybe people under pressure are more curt and "mean"?

Now, I might not want to work somewhere like that. Or, if that place did produce the best results and offered me the best mix of compensation, advancement, travel, and furthering my other goals - well, maybe I would want to work there for a little while. The more interesting question to me is how effective these cultures are at accomplishing their goals - I wouldn't mind spending time in a pressure cooker for a while if it furthered my goals. (But then, it might not - but it'd be interesting to see some results; I'm going to go off on a limb and guess Apple has a more intense culture than Yahoo, for instance, but also much more prestige and opportunity these days)

So does mean that money makes executives mean or that mean executives pay themselves more than nice executives?

Correlation is not causation.

The article seemed to indicate performing experiments where meanness could be created in the test subject by altering parameters of the experiment (granting them more power).

As far as I can decode the experiment, it seems that people who were told "you did one question better on the test, we gave you 65 points and the other person 15 points" were more likely to be mean than people who were told "you did one question better on the test, we gave you 65 points and the other person 60".

The link to executive compensation is highly nonobvious.

In the study the participants were all assigned the same "compensation", and randomly assigned to groups where the fictional employee had either high or low "compensation" inequality. So to the extent that this study supports the conclusion, it's not because mean executives pay themselves more.

Does anybody read the articles any more, or just the headlines?

I did read the article. I guess I missed something.

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