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High pay seen as sign of competence, study suggests

When given the choice, people prefer to collaborate on work projects with higher-paid colleagues, but they want to hire subordinates with a lower pay history than theirs, according to research published in the journal American Psychologist.

The research aimed to explore how a trend toward increasing pay transparency in the business world may affect workers' behavior.

"I've long been interested in the ways in which slight—and not-so-slight—differences in salaries can generate strong reactions from people," said Kevin Kniffin, Ph.D., an assistant professor at Cornell University and co-author of the study.

"When combined with the trend toward more pay transparency in organizations, whether required by law or crowdsourced by employees, and the trend toward more teamwork and collaboration in work, it's increasingly valuable to understand more about how people think about pay differences in relation to co-workers and potential collaborators."

Some researchers have hypothesized that pay transparency could cause workers to resent—and avoid working with—higher-paid colleagues. But Kniffin and his colleague Angus Hildreth, Ph.D., suspected that might not be the case, and that instead people might use pay as a signal to decide which co-workers were most competent.

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