# What is the relationship between income and productivity? **URL:** \ **Category:** Great Debates\ **Created:** [April 26, 2015, 1:55am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547 "2015-04-26T01:55:50Z")\ **Posts on this page:** 10\ **Page:** 10
**Author:** ![LinusK](https://avatars.discourse-cdn.com/v4/letter/l/258eb7/32.png) [@LinusK](https://boards.straightdope.com/u/LinusK)\ **Post date:** [May 22, 2015, 1:56am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/181 "2015-05-22T01:56:55Z")
> [@Mijin](#): > > Perhaps you’d find it more interesting if you actually had a debate for once. > What’s funny is, I, and I think most people, would agree that income and productivity are not _perfectly_ correlated. I’m just taking exception to you saying rarely or weakly correlated, and the misconceptions your examples seem to be based on. > But it’s not as though my position is actually that far from yours. > > The first thing to say is that it’s pretty pointless trying to use individuals as examples. Why pick a CEO who bankrupted his company and not one who saved her company? > > If you want to say there is a general pattern of higher paid CEOs performing worse, then say it, otherwise it’s just an irrelevant anecdote. I did say it, and provided links to the studies that showed the exact pattern you’re describing. > [@](#): > > But to address these specific examples: > > **Jonas Salk** wasn’t a volunteer worker: he drew a salary the whole time he worked on the polio vaccine, presumably a pretty decent one as an already respected scientist / researcher with a well-funded laboratory. > Had he patented his vaccine (and if it was indeed patentable) the standard estimate is that he would have earned $7 billion in inflation-adjusted dollars. Essentially he chose to waive this income for the good of the world. > It’s just like the pro bono lawyer again; essentially “gifting” a service but that doesn’t mean what they do is not valued by the market. I’m not sure what point you’re making. My argument is that productivity and income are not closely correlated. Whether Salk couldn’t patent it, or chose not to is beside the point. The point is that he derived little income for doing something that was incredibly productive. > [@](#): > > **Dick Fuld** was a well-qualified trader who worked his way up the company over decades presumably by showing great aptitude. And when he reached the top he was not well paid to sink the company he was well paid because they had an expectation that he would be crucial to the success of the business. > Consider pro sports. That really should be a meritocracy given that everything every player does is watched by millions and analyzed to the bajillionth decimal place. > Yet big sports teams sometimes take on guys who then hugely disappoint. Why? > Well obviously because humans can’t predict the future. All we can do is make good estimates based on past performance. Same with CEOs. Again, my point is that productivity and income are poorly correlated. You’re saying that’s because people can’t predict the future. I don’t think that’s the main reason, or even in the top ten. But even so, it’s still a reason why income and productivity are poorly correlated. Which is the point I’m trying to make. ---
**Author:** ![Mijin](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mijin/32/9369_2.png) [@Mijin](https://boards.straightdope.com/u/Mijin)\ **Post date:** [May 22, 2015, 3:28am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/182 "2015-05-22T03:28:13Z")
> [@LinusK](#): > > I did say it, and provided links to the studies that showed the exact pattern you’re describing. All I see are links about ethics. I don’t see a link that shows the pattern I just mentioned, or supports your point. > [@](#): > > I’m not sure what point you’re making. My argument is that productivity and income are not closely correlated. Whether Salk couldn’t patent it, or chose not to is beside the point. The point is that he derived little income for doing something that was incredibly productive. He derived little income _because he waived his income_. This is among the more desperate attempts to contrive an example I’ve ever seen. > [@](#): > > Again, my point is that productivity and income are poorly correlated. You’re saying that’s because people can’t predict the future. I don’t think that’s the main reason, or even in the top ten. But even so, it’s still a reason why income and productivity are poorly correlated. It’s a reason why income and productivity are not perfectly correlated, yes (and I explicitly said that a few messages ago). I still have no reason to suppose they are poorly correlated. ---
**Author:** ![Try2B\_Comprehensive](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/try2b_comprehensive/32/65_2.png) [@Try2B\_Comprehensive](https://boards.straightdope.com/u/Try2B_Comprehensive)\ **Post date:** [May 22, 2015, 7:33am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/183 "2015-05-22T07:33:19Z")
The thread boils down to fairness. There is an element of fairness in the world- one can find plenty of examples of hard workers getting ahead, and plenty of examples of horrible criminals being caught and punished. You can also find examples of horrible criminals seeming to get away with it, or innocent, hard workers falling on hard times. The universe seems indifferent, but human wills can have an effect on human affairs. Does the OP have a theory of justice by which we can fairly set wages? ---
**Author:** ![LinusK](https://avatars.discourse-cdn.com/v4/letter/l/258eb7/32.png) [@LinusK](https://boards.straightdope.com/u/LinusK)\ **Post date:** [May 23, 2015, 12:46am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/184 "2015-05-23T00:46:08Z")
> [@Mijin](#): > > All I see are links about ethics. I don’t see a link that shows the pattern I just mentioned, or supports your point. It’s post #[56](http://boards.straightdope.com/sdmb/showpost.php?p=18321547&postcount=56). ---
**Author:** ![LinusK](https://avatars.discourse-cdn.com/v4/letter/l/258eb7/32.png) [@LinusK](https://boards.straightdope.com/u/LinusK)\ **Post date:** [May 23, 2015, 1:05am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/185 "2015-05-23T01:05:55Z")
> [@Try2B\_Comprehensive](#): > > The thread boils down to fairness. There is an element of fairness in the world- one can find plenty of examples of hard workers getting ahead, and plenty of examples of horrible criminals being caught and punished. > > You can also find examples of horrible criminals seeming to get away with it, or innocent, hard workers falling on hard times. The universe seems indifferent, but human wills can have an effect on human affairs. > > Does the OP have a theory of justice by which we can fairly set wages? No. There is no way to make the world fair, or to make sure people get paid the value of their productivity. (Of course, if I were King, I could make things better; not perfect, but better.) But before you say, “Well, who cares, then?” there is a point here. The assumption that “income = productivity” is one of the pillars of the conservative/libertarian worldview. Without it, much of their rhetoric becomes nonsense. You see it in the argument, “Why should the most productive people get taxed the most?”. It’s also an implicit assumptions behind the phrase “job creators,” and all the complaining about how X% of people pay no taxes. ---
**Author:** ![emacknight](https://avatars.discourse-cdn.com/v4/letter/e/3ec8ea/32.png) [@emacknight](https://boards.straightdope.com/u/emacknight)\ **Post date:** [May 23, 2015, 1:32am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/186 "2015-05-23T01:32:11Z")
> [@LinusK](#): > > But before you say, “Well, who cares, then?” there is a point here. The assumption that “income = productivity” is one of the pillars of the conservative/libertarian worldview. Without it, much of their rhetoric becomes nonsense. You see it in the argument, “Why should the most productive people get taxed the most?”. It’s also an implicit assumptions behind the phrase “job creators,” and all the complaining about how X% of people pay no taxes. And here is the real point of this thread. All the nonsense and rhetoric about productivity and income was smoke and mirrors just so that **LinusK** could bitch about the conservative/libertarian worldview. So let’s recap: we started with a thesis “productivity is poorly correlated to income.” To prove that **LinusK** pulled a definition out of his ass for productivity (but not income), then proceeded to describe some people he thought were productive, and some people he felt anti-productive. All this entirely based on his own subjective determination of what he personally considers as productivity. What a surprise that the people he felt were productive had low income, while people he felt were anti-productive had high income. Out of the 7 billion people on this planet earning income and being productive, it seems an economic theory only requires 5 or 6 poorly thought out examples. It would appear that only a true Scotsman earns an income that correlates to his productivity. And that’s why the rich shouldn’t be allowed to own things. QED {drops mic} ---
**Author:** ![LinusK](https://avatars.discourse-cdn.com/v4/letter/l/258eb7/32.png) [@LinusK](https://boards.straightdope.com/u/LinusK)\ **Post date:** [May 23, 2015, 4:19am UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/187 "2015-05-23T04:19:15Z")
Your comment is completely self-serving. The question is “what is the relationship between income and productivity”. I believe the relationship is weak, and went to great lengths to provide evidence to support the claim. You dismiss everything I said, which is fine. It doesn’t surprise me. I’m not under the illusion that I’m going to convince you of anything. In truth, I write because I like it. I realize a lot of the folks just want to “win”, or to prove how smart they are, or to repeat whatever ideology they subscribe to, for the sake of repetition. But I’m saying what I believe, after giving it a lot thought, and provide the best evidence I can. I’m trying (not always successfully, I admit) to engage honestly with people who are making at least some effort to do the same. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [May 23, 2015, 12:11pm UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/188 "2015-05-23T12:11:54Z")
> [@Mijin](#): > > All I see are links about ethics. I don’t see a link that shows the pattern I just mentioned, or supports your point. If you measure CEO productivity by stock returns, which nobody does, you can draw these conclusions. Never mind that executive services for a company that is doing poorly can be of higher value than for those that are not. ---
**Author:** ![LinusK](https://avatars.discourse-cdn.com/v4/letter/l/258eb7/32.png) [@LinusK](https://boards.straightdope.com/u/LinusK)\ **Post date:** [May 24, 2015, 4:28pm UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/189 "2015-05-24T16:28:40Z")
> [@Ruken](#): > > If you measure CEO productivity by stock returns, which nobody does, you can draw these conclusions. Never mind that executive services for a company that is doing poorly can be of higher value than for those that are not. Usually I don’t do this, but I’m so sure people **do** measure CEO performance by changes in the value of the company’s stock, I’m going to ask for a cite. Just give me any reasonably reliable source that says that “nobody” does this, and I’ll eat my hat. Also, I feel compelled to point out the example I used was of a CEO who bankrupted his company. Do you think that he was productive? ---
**Author:** ![Bone](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bone/32/407_2.png) [@Bone](https://boards.straightdope.com/u/Bone)\ **Post date:** [June 14, 2018, 8:25pm UTC](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547/191 "2018-06-14T20:25:25Z")
> [@alabam](#): > > right > … > You can also find examples of horrible criminals seeming to get away with it, or innocent, hard workers falling on hard times. The universe seems indifferent, but human wills can have an effect on human affairs. Hi, **alabam** - Welcome to the Straight Dope! This thread is rather old and many of the participants, including the original poster, are no longer on the boards. As such I’m going to close this thread. If you’d like to start a new discussion, please feel free to do so. [/moderating] [Previous page](https://boards.straightdope.com/t/what-is-the-relationship-between-income-and-productivity/718547.md?page=9)