Patricia Cohen reports that the CEO of Gravity Payments has established a minimum wage of $70,000/year. He did this, Cohen explains, because he read Daniel Kahneman and Angus Deaton’s article “High Income Improves Evaluation of Life but Not Emotional Well-Being,” which appears in the Proceeding of the National Academy of Sciences, 107(38). In the article, Kahneman and Deaton conclude, after analyzing a large amount of data, that wages can contribute to human beings’ level of happiness: above $75,000, no more happiness but below $75,000, much less happiness. Dan Price, the Gravity Payments’ CEO, wants happy employees, so establishing a $70,000 minimum wage was a no-brainer.
For information on Gravity Payments, check out the About page on the company’s website.