Working Paper: NBER ID: w22571
Authors: Mitchell Hoffman; Elizabeth Lyons
Abstract: Paying higher salaries is often believed to enhance worker effort, leading workers to work harder to avoid getting fired. However, workers may also respond to higher salaries by focusing on tasks that most directly affect getting fired (as opposed to those that contribute most to productivity). We explore these issues by analyzing the relationship between the level of compensation and time use for US state legislators. Using data on time use and legislator salaries, we show that higher salary is associated with legislators spending more time on fundraising. In contrast, higher salary is also associated with less time spent on legislative activities and has no clear relation to time spent on constituent services. Subgroup analysis broadly supports our interpretation of the data.
Keywords: salaries; state politicians; time use; fundraising
JEL Codes: D72; H70; M52
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Higher salaries (J31) | Increased time spent on fundraising activities (L39) |
| Higher salaries (J31) | Decreased time spent on legislative activities (D72) |
| Higher salaries (J31) | Time spent on constituent services (I39) |