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Compensating Differentials

by Jadrian

Tate has no problem sharing his salary, but it's unclear the main driver of the salary. In reality, salaries are comprised of a variety of skill and compensating differentials as well as potential efficiency payments. Tate has a doctorate of pharmacy, which should result in higher pay for human capital investments. In the clip above he mentions that people could die if he messes up, which probably adds a lot of pressure to his workday. This pressure could be a compensating differential that increases his pay. However, there's also a chance he's paid highly so that he doesn't goof off, which would be an efficiency payment.

Superstore -- Shirking Model

Tate makes a lot of money, but he feels like he's worth it

from Superstore (2015)
Creator: Justin Spitzer
Distributor: Hulu
Posted by Jadrian
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