In this essay I discuss the question of wether it is necessary to pay people different amounts in order to attract the most able to the most important jobs. I start by introducing the discussion of social inequality which is surrounding the question of this essay, then I extract and evaluate the assumptions of the question and conclude with a set of premises on which the necessity proposed by the question can hold.
The question of this essay is part of an ongoing discussion in the literature of social inequality. Kingsley Davis and Wilbert Moore published in 1945 an article titled ‘Some Principles of Stratification’ (Davis and Moore, 1945) which states that social inequality, through the concept of social stratification, is an “unconsciously evolved device by which societies insure that the most important positions are conscientiously filled by the most qualified persons.” (Davis and Moore, 1945: p. 243). Their article is widely referenced in the discussion of social inequality and part of a public intellectual exchange between Melvin Tumin, Davis and Moore (Tumin, 1970: p. 367-392). It is worth noting at this point that the discussion of social inequality is naturally driven via empirical generalisations as well analytical theory and therefore, a sound argument needs to combine these two so that it is not solely driven by experience or solely driven by theoretical constructs. (Huaco, 1966: p. 217)
There are multiple understandings of what social stratification is and consequently discussions around it have been partly shaped by misunderstandings instead of actual debate. Buckley raises the point that Davis and Moore choose a too abstract definition of social stratification which is missing critical attributes of what strata are for example the inheritance principle, but Huaco rightly concludes that it is “commonplace that scientific theories require a fairly high level of abstraction; and if this abstraction makes possible an increase in analytical precision, then the desirability of abstraction is beyond question.” (Huaco, 1966: p. 224) Therefore, I will work with the definition of social stratification as being nothing more than the differentiation of social positions. Based on the concept of social stratification, Davis and Moore constructed the functional theory of stratification whereby they try to evaluate an alleged necessity of social inequality for the survival of society (Huaco, 1966: p. 225; Dallmayr, 1967: p. 1) This theory is close to the concept of the ‘difference principle’ by John Rawls which is explained in his essay ‘Justice as Fairness: Political not Metaphysical’ whereby “Social and economic inequality […] must be to the greatest benefit of the least advantaged members of society.” (Rawls, 1985: p. 227) Both the functionalist theory and the difference principle see social inequality as a necessity for the achievement of a goal of justice or survival of the society.
The question of this essay strictly does not deal with social inequality. It is a technical question which is looking to understand wether the most able can be attracted to jobs via incentives. Only when we start looking into fulfilling these incentives via the payment of different amounts and only when we treat the payment of different amounts as a social inequality, then we need to address social inequality as part of this question. Therefore, we need to answer wether incentives imply the payment of different amounts and then check how social inequality is related to incentives.
I will rephrase the question to create a better overview of the assumptions. The first part ‘Is it necessary to pay people different amounts’ can be rephrased into ‘Payment of different amounts is necessary’ (PDA) and the second part ‘in order to attract the most able to the most important jobs’ can be rephrased into ‘if we want optimal allocation of the most able’ (OAA). Therefore, we can give the following statement of necessity:
If OAA, then PDA.
OAA consists of three parts: ‘attraction’, ‘the most able’ and ‘the most important jobs’. The most able are either people with talent or training or both. Ability consists of a combination of talent and training. If we rely on our experience, we can state that talent is unequally distributed and that talents need to be discovered which requires time. Further evidence in statistics shows that human attributes such as height, width or ability have a ‘normal distribution’, not an equal distribution, see figure 1. (Kline, 1964: p. 392)
The time for talent discovery cannot be spent on general productive tasks, the payoff of this investment of time only becomes evident at a later point in time. The same investment rule holds for training: people need to invest some time in training to arrive at a higher state of training. (Tumin, 1953: p. 389)
If we assume that these time investments are generally investments of money, then people with more money have an advantage in talent discovery and training compared to people with less money. As a consequence, two individuals with the same talent but different monetary starting position will arrive at different states of ability. In our world, this difference in money is most observable through acts of inheritance. Let’s keep this difference in mind when we take a look at the ‘most important jobs’.
The importance of a job is determined by norms which in societies are agreed upon by humans. First of all, we need to understand why importance to jobs is assigned in the first place.
One possible reason could be that if a society’s performance does not exceed a certain value — the ‘survival value’ (Tumin, 1953: p. 388) — then it will extinct. For example a society might go extinct if the agricultural production halts so that no food is produced and people starve to death. Therefore, the jobs which ensure that the survival value is exceeded, for example the people in the food industry, are given the highest importance. If we assume that the survival value is at the heart of all societies, we need to understand how the importance of a job is determined. Moore describes such a process in his essay ‘But Some Are More Equal Than Others’ (Moore, 1963: p. 14) Societies decide upon the importance of jobs through agreeing on norms, which poses potential issues.
We can observe that in reality only parts of societies are involved in the norming process, most often the most able themselves decide the norms of job importance. This observation is deceivable to lead to the conclusion that the most able will try to keep or increase the importance of their own job during the norming process. If we take into account the inheritance difference we briefly discussed before, whereby people who inherit money naturally gain an advantage regarding talents and training and therefore go into more important jobs than other equally talented people, then we might conclude that these two phenomena — advantage through inheritance and subjective norm formation — will lead to a part of society and its offspring to be generally better rewarded than others regardless of differences in talent. But as Moore rightly concludes: “one must have a strong urge to believe in the power of evil to view all such norms as maliciously imposed by persons of privilege” (Moore, 1963: p. 14) and furthermore one “might just as properly view social systems characterised by complex role differentiation as conspiring against the sociologist’s attempt to impose on them a simplified structure of ‘social stratification’” (Moore, 1963: p. 16).
Furthermore it is important to distinguish economic contribution and functional importance. Richard L. Simpson questions the Davis-Moore theory on an observational basis that there seem to be high rewards for positions without actual impact on society at large (Simpson, 1956: p. 134) to which Huaco rightly responds that “economic contribution and degree of functional importance are not identical notions.” (Huaco, 1966: p. 221)
PDA is the payment of different amounts to people. ‘Different amounts’ is a vague description of a payoff when we take a look at how multifaceted people in this world can be payed off. Most of the time it is in the form of money, but there are also non-monetary payoffs for example having a healthy baby can be considered luck regardless of the money which could have been put in. Research in genetics is getting closer to having perfectly healthy babies, but we are just not there, yet, so that we can say with certainty that there a things money can not buy.
So far we have looked at each OAA and PDA separately. Now, we take a look at the connection between these two. OAA requires a way to allocate the most able to the most important jobs. PDA gives an answer to this: the payment of different amounts. Implicit in this connection is that people are driven to maximise their own utility, that they follow incentives. They allegedly choose the job which generates them the most money. But as we have seen there are apart from monetary rewards also non-monetary awards. The most able might prefer a less important job as it allows them to enjoy non-monetary awards. In this case, where there is no money able to attract the most able to a job as the most able prefer non-monetary rewards, OAA cannot be reached despite PDA.
Additionally, one might be motivated by fulfilling an intrinsic virtue. Saladin Meckled-Garcia introduces in his essay ‘Why Work Harder? Equality, Social Duty and the Market’ three types of motivations to work against social inequality based on different ‘readings’ of the difference principle by Rawls: ‘simple re-distribution’ is the equal distribution of existing wealth regardless of the level of production of the society, ‘productive growth’ is the duty to create greater wealth while being indifferent to how it is distributed, and ‘social duty’ is the combination of the preceding two: the duty to create greater wealth and distribute it equally. (Meckled-Garcia, 2002: p. 783) People take on these motivations more often based on ideological reasoning than deep analysis, either way we can see them as potential motivators for the most able to contribute to society and therefore choose to do the most important jobs. In the case of the social duty thesis people would, based on belief, not require the payment of different amounts.
In sum, there are multiple motivations regarding someone’s participation in society: simple material payoffs or types of intrinsic belief. If we assume the question of this essay to be solely technical, we can answer that given the distribution of talent is unequal and humans are naturally driven by incentives, we need to pay different amounts to people to attract the most able to the most important job. If we want to optimally attract the most able to the most important jobs, we require an abolishment of inheritance or at least a counter-weight to inheritance as well as an unbiased allocation of job importance. Furthermore, if we see the survival of society as a moral duty, then following the functional thesis by Davis and Moore is a requirement so that social inequality through the payment of different amounts is unpreventable. Finally, if we assume that there is a social inequality because of unequal talent distribution or the payment of different amounts and we feel morally obliged to bring about equality in society, we require people to take on intrinsic believes such as the social duty thesis by Meckled-Garcia, so that production growth is assured while economic wealth is equally distributed.
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