In some countries, a few people earn extremely high salaries. Some people think this is good for the country, while others believe that the government should control salaries and limit the amount people earn. Discuss both views and give your opinion.
Write on the given topic in 200-300 words.
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MODEL ESSAY 1:
There has been a lot of debate on few people earning extremely high salaries. Some statistic may indicate that 70% of a country’s income is controlled by 20% of that country’s residents. This raises concerns about income being distributed in an uneven manner among the population. Some people are of the opine that the government should control salaries and limit the amount people earn while others believe that high salaries motivates employees to work hard and deliver better performance.
On the one hand, a private company offer salary to its employees based on one’s position, education, experience and performance. So what the company want to pay an employee should never be decided by a government entity. The government should not be in the position of controlling or limiting the salaries of corporate executives. It will be against the free enterprise market system. For example, if a company wants to pay an executive $10 million in compensation, that should be its decision. I think that the interference of government body in the private sector could prove disastrous for any large corporations.
On the other hand, this is a fact that income disparities have been growing markedly. For instance, America’s top 10 percent now average more than nine times as much income as the bottom 90 percent. The salaries of some people are ridiculously high. If the government limits the amount paid to a position then highly paid salaries could be lowered to benefit other employees. For example, middle level managers could be paid more and executives paid a bit less.
To conclude, I am of the opinion that instead of setting a limit for high job salaries, the government should work on the core cause of income disparity which are cheap labor, unfair exchange rates, jobs outsourcing, illegal immigrants etc.
MODEL ESSAY 2:
In some countries, income inequality, or the gap between the rich and everyone else, has been growing markedly. The topic of income disparity has become a moot issue. Some people opine that only a few individuals earning an extremely high salary is good for the country while others think increasing income inequality has a negative effect on economic growth.
The higher income for top-most executives certainly plays an important role in motivating low-paying employees to work harder and deliver better performance. Many studies shows that financial incentives are a basic need and pay-for-performance model certainly sets companies up to succeed. Such model motivates leaders to steer their companies toward high performance. The government organizations often lose their top-most management as compared to private enterprises that pay huge pay and bonus. Limiting or regulating salaries in the private sector has the capacity to do real damage.
On the other hand, there is a widespread concern that increasing income inequality will have greater impact on our societies and economies. Various studies suggests that income inequality has a negative and statistically significant impact on medium-term growth. For instance, the societies such as Syria and Libya which have extreme income inequality are more unstable socially than others. Also, the poor citizens of society are less able to invest in their education.
The greater equality prior to the crisis helped increase GDP per capita in a few countries, notably Spain. In conclusion, I think that the government should put up a body to regulate extremely high salary in the private sector. Striking a balance between the two is the path for the economic and social progress of a country.