Thursday, January 14, 2010

Political Calculations doing its job


They have created the distribution of incomes for Federal Workers. I stole their chart.

What am I looking for here?, the long tail on the right, a stretch out of high government officials making more than $100,000.

Is that tail normal? No, the tail represents the inefficiency of government operations. The long tail does not obey an entropy function and tells us that those making over $150,000 are useless in adding information about government operations. Look at the tail from the $170,000 mark. The distribution allocates about $100,000 of salary range out of a total $300,000 salary range. Almost 1/3 of the wage settings are devoted to salaries that occur less than 1/200 of the time. So, one might say government employers do not bargain well with their salary budgets.

But, this distribution is much better than salary distributions for many major corporations, I suspect.

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