In my opinion you should have made an extensive argument for this in your OP since it’s really a key point of your argument.
The link is interesting but I think the mechanisms destroying the link between social value and income are stronger than argued there. To take just one example, some socially useful jobs might be more fun than others. That will increase the number of people willing to take them which will drive down wages.
Also in many areas the market distortions are strong. For instance it might be that a brilliant politician is worth hundred of billions dollars to the US economy but he could never be that well-paid. Generally in the public sector the link between income and social value is rather weak.
Within a certain profession you often have I would guess, a fairly strong correlation between the social value of your work and your income but when you compare different professions the correlation gets weaker.
In any case you have three factors: intelligence, income and social value of work. Your thesis is that the fact that more intelligent people have a higher income which shows that the social value of their work is greater. I agree with the conclusion but think that the social value of their work is far greater than their incomes would suggest. For instance academics are generally smart and the social value of their work is on average great but their incomes are not very high.
The link is interesting but I think the mechanisms destroying the link between social value and income are stronger than argued there.
It establishes a Bayesian prior. Even if the correlation is weak, it can be very difficult to beat the prior.
To take just one example, some socially useful jobs might be more fun than others.
Some socially useful jobs are also less fun than others.
For instance it might be that a brilliant politician is worth hundred of billions dollars to the US economy but he could never be that well-paid. Generally in the public sector the link between income and social value is rather weak.
Yes, this is a good point.
For instance academics are generally smart and the social value of their work is on average great but their incomes are not very high.
If the correlation is weak, then lacking any other evidence, the relationship suggested by the correlation might be your best bet, but it’s not a bet you should be making with high confidence.
I also think that the page underrates the strength of the arguments against the link. A couple other considerations which can undermine the link may include
*Individuals and corporations becoming wealthy via exploitation of captive markets. While in an idealized free market, individuals attract customers by providing better services than their competitors, in reality there are many cases where customers are effectively chained to a single service provider (such as in cases of utilities or transportation services.) In these cases, businesses can effectively decouple their operation costs from their revenues. Warren Buffet has explicitly described investment into businesses with captive markets as one of the cornerstones of Berkshire Hathaway’s business strategy. In these cases, replacing the individuals or corporations with ones that did not exploit their market would result in a decrease in income, but an increase in societal wealth.
*Certain careers or businesses may systematically allow individuals to capture markedly different amounts of the value they create. Hard-to-replace individuals don’t just create more value than people working in more easily filled positions, they also have much stronger bargaining positions with respect to the terms of their employment.
Individuals and corporations becoming wealthy via exploitation of captive markets.
Can we also factor in Dark Core (or Dark Triad Traits) for the divergence between income distribution (what happens) and social value distribution (what is expected)?
The validity of that argument is strongest when dealing with a competitive marketplace, both on the supplier and on the consumer side. For instance, there is a large, competitive pool of people willing to work in fast food places. There is also a large pool of businesses willing to hire fast food workers that, although not quite as competitive as the worker pool, is still reasonably competitive. Thus, one can expect fast food workers’ income to be a good starting point, perhaps biased in the downward direction (although other effects such as minimum wage laws may bias it upwards). Microsoft, on the other hand, is a monopoly, and its immediate consumers are often large corporations that also are not completely competitive. Thus, this argument is significantly less valid.
See Social value of work: income as a proxy.
In my opinion you should have made an extensive argument for this in your OP since it’s really a key point of your argument.
The link is interesting but I think the mechanisms destroying the link between social value and income are stronger than argued there. To take just one example, some socially useful jobs might be more fun than others. That will increase the number of people willing to take them which will drive down wages.
Also in many areas the market distortions are strong. For instance it might be that a brilliant politician is worth hundred of billions dollars to the US economy but he could never be that well-paid. Generally in the public sector the link between income and social value is rather weak.
Within a certain profession you often have I would guess, a fairly strong correlation between the social value of your work and your income but when you compare different professions the correlation gets weaker.
In any case you have three factors: intelligence, income and social value of work. Your thesis is that the fact that more intelligent people have a higher income which shows that the social value of their work is greater. I agree with the conclusion but think that the social value of their work is far greater than their incomes would suggest. For instance academics are generally smart and the social value of their work is on average great but their incomes are not very high.
It establishes a Bayesian prior. Even if the correlation is weak, it can be very difficult to beat the prior.
Some socially useful jobs are also less fun than others.
Yes, this is a good point.
See our page on Social value of academia
If the correlation is weak, then lacking any other evidence, the relationship suggested by the correlation might be your best bet, but it’s not a bet you should be making with high confidence.
I also think that the page underrates the strength of the arguments against the link. A couple other considerations which can undermine the link may include
*Individuals and corporations becoming wealthy via exploitation of captive markets. While in an idealized free market, individuals attract customers by providing better services than their competitors, in reality there are many cases where customers are effectively chained to a single service provider (such as in cases of utilities or transportation services.) In these cases, businesses can effectively decouple their operation costs from their revenues. Warren Buffet has explicitly described investment into businesses with captive markets as one of the cornerstones of Berkshire Hathaway’s business strategy. In these cases, replacing the individuals or corporations with ones that did not exploit their market would result in a decrease in income, but an increase in societal wealth.
*Certain careers or businesses may systematically allow individuals to capture markedly different amounts of the value they create. Hard-to-replace individuals don’t just create more value than people working in more easily filled positions, they also have much stronger bargaining positions with respect to the terms of their employment.
Can we also factor in Dark Core (or Dark Triad Traits) for the divergence between income distribution (what happens) and social value distribution (what is expected)?
The validity of that argument is strongest when dealing with a competitive marketplace, both on the supplier and on the consumer side. For instance, there is a large, competitive pool of people willing to work in fast food places. There is also a large pool of businesses willing to hire fast food workers that, although not quite as competitive as the worker pool, is still reasonably competitive. Thus, one can expect fast food workers’ income to be a good starting point, perhaps biased in the downward direction (although other effects such as minimum wage laws may bias it upwards). Microsoft, on the other hand, is a monopoly, and its immediate consumers are often large corporations that also are not completely competitive. Thus, this argument is significantly less valid.