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> A thing that I always wondered: What gains a manager by being cheap about his subordinates' salaries?

A manager's job is to manage resources to provide the firm with the maximum benefit for the least cost, and salary is one of the more obvious non-fuzzy components on either the cost or benefit side of that equation.

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Only if you completely ignore the direct and indirect effects of salary on the employee.

Which an alarming majority does, but still.

I understand that, but how the company organize itself to reward managers with that kind of goals ? What kind of mechanisms sets in place to force managers to minimize expenses happily?

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