EU politicans who got raises worked less; MEPs with pay-cuts worked more


Makes you wonder what would happen if we’d stop paying them.


The Polish MEPs saw their pay more than triple. Does that mean they work 8% less now?

A correction Cory: UK MPs have not just received a massive pay rise - an independent committee has suggested they get one but it has yet to be accepted and all three main party leaders have said they will reject it. I would have thought you’d have known this.

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They missed one meeting in the course of a year? That doesn’t sound like a statistically significant difference to me.

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I do voluntary work (for a not-for profit, albeit one that is highly commercial) in a relatively skilled customer facing role. If they had to pay me, they couldn’t afford me (though that doesn’t stop an internal ongoing debate on the issue).

Behavioral economists have known this for awhile now:
“As long as the task involved only mechanical skill, bonuses worked as they would be expected: the higher the pay, the better the performance. But once the task called for ‘even rudimentary cognitive skill,’ a larger reward ‘led to poorer performance.’”
D Ariely, U Gineezy, G Lowenstein, and N Mazar, Federal Reserve Bank of Boston Working Paper No. 05-11, July 20005: NYTimes, November 20, 2008

“In eight of the nine tasks we examined across the three experiments, higher incentives led to worse performance.”
D Ariely, U Gneezy, G Lowenstein, and N Mazar, Federal Reserve Bank of Boston Working Paper No. 05-11, July 20005

After looking at 51 studies of pay for performance plans in a variety of companies:
“We find that financial incentives… can result in a negative impact on overall performance.”
Dr. Bernd Irlenbusch, London School of Economics

These finding not only apply to politicians but to business as well. If you want to motivate people who are not doing rote tasks, offer them a certain amount of autonomy, a chance for mastery, and an overall goal they want to strive toward. Offering them just more money will tend to impair rather than improve their performance. The evidence seems to be clear.

So, the more we pay 'em, the less they’ll interfere with our lives?

Wouldn’t that also mean that the more they are bribed - lobbied, I mean - the less effective they will be because they believe they need to be seen by their owner to be more active? Or, the very reverse of that - because, this?

Complicated stuff, money.

At some level of payment, more money seems to create a disconnect between the person being paid, and the people they’re supposed to lead/represent. A higher net worth seems to persuade that person that they are worth more, and count more, than people who are not. I wonder if this is linked to the findings?

Or it could be “I’ve got a Lot of money, why do I need to work so much??”

I googled the two authors b/c their conclusions sounded suspicious. Their prior scholarly contributions reach similarly dubious conclusions that the death penalty (Mohan) and concealed carry (Altindag) are effective deterrents to crime. (While at Louisiana & Alabama universities.) Anyone else smell ideological bias?

Popular disdain for politicians & bureaucrats aside, seems this study should come with several grains (er, handfuls) of salt.

Caveat emptor.

Another thought: In support of Jessica_B’s comment that the data seems statistically insignificant, I’d argue there may well be an inverse correlation that turns the authors’ conclusions upside down.

In my experience, more meeting attendance doesn’t correlate highly to productivity. In fact, I often see an inverse correlation. The lowest performers are very likely to fill the seats (and do little else)…

I used to delight in asking Economics students to define money for me. Invariably, they would define coinage instead and become quite flustered when I pointed this out. For a good explanation of the complications of money, I have found that Stephenson’s ‘Baroque Cycle’ is an excellent, if long, introduction. To be fair, money is just one part of that awesome work.

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