Tuesday, January 23, 2007

You greedy little bugger!

Thomas Sowell provokes us to ask: are you greedy?
If I offered you $100 right now would you take it?
What if I offered you $200? Well, shucks, looks like you are greedy. Or maybe you just aren't stupid. What about me, the guy offering you the money, am I greedy? Am I stupid?
Which brings us to Sowell's point, "Why do other people choose to pay corporate executives so much?"
Because there's a competitive market out there for guys who can earn companies millions of dollars, and as long as the wage doesn't exceed diminishing marginal returns it will be paid.
He goes on to remind us how it is that we all got so wealthy, by specializing in those activities in which we enjoy a competitive advantage.

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