Godechot’s book is a little reading gem: fluid and flowery style, it has this ability to hang the reader from the first sentence, like a very good novel.
Godechot takes up the spotlight given by Thomas Piketty on the richest (more precisely the richest 0.01%) and recalls that one of the interesting points to lift is that the increase in inequality and the relative and absolute enrichment of these richest is no longer due to both the property of the capital and the wages. As the author says, “ We traditionally represented the rich as a rentier. Here he is now an employee ». Is this the end of the struggle between capital and labor ? No, because the author re -examines the sharing of added value and shows how the employee is not only an employee but also an capitalist, an investor in capital, investment which is his specific knowledge.
The originality of Godechot’s work in the abundant economic literature on wage inequalities, their causes and their evolution, is in the methodology adopted, borrowed from sociology. The book is an example of economic sociology. The author conducted a field survey of almost three years between 2000 and 2002 (questionnaires, 70 interviews, 7 months of participating observation as an intern, etc.) with a specific category of “ Working Rich »: Employees rich in financial circles.
That Godechot shows us ? That the finance environment is entirely turned towards profit ? Until then, nothing very surprising. The economist is used to modeling the behavior of any entrepreneur as well as maximizing profit. The author especially shows that the economic theory of incentives fails to account for the magnitude of the bonuses. To simplify, we could say that the theory of incentives tells us that the employee has hidden information on the effort he provides. This hidden information provides a profit to the one who owns it. The company wishes to set up a remuneration system allowing it to reveal this hidden information, in other words to remunerate the employee to his effort, which she does not observe. Performance indicators play this role of being observable and correlated with the employee’s effort. Certainly the company succeeds in aligning the objectives of its employees with its own thanks to the adequate use of performance remuneration linking the income of traders for the benefit of the company. Indeed, the traders Can hope to touch between 5 and 8% of the results of their portfolio, which is compatible with the theory of incentives. Yet no, the theory of incentives is not enough to account for the importance of these bonuses, because, says Godechot, a lower amount would be enough to encourage any worker. In addition, the theory of incentives also shows that the fixed salary that the employee receives must be determined in such a way that the agent agrees to participate in this employment contract, in other words that he earns at least as much as he could earn elsewhere. The author maintains that the wages fixed traders is too high in terms of what their counterparts earn in other sectors. This incentive system therefore seems very (too much ?) costly for the company. No, it is not their initial qualification that justifies significant productivity and therefore important wages, since the traders are not more qualified than many other executives.
Godechot wants to show that the traders There are not strictly speaking of employees holding a work force: they are much more capitalists, in that they have own capital and have property rights on the benefit of the financial company. What is this capital ? The specific capital (specific active) accumulated and fruited within the company (portfolio, network of customers, etc.). The author therefore finds a Marxian or Bourdieusian conception placing having it at the heart of power. It re -examines the idea that employees have capital and therefore have a share of the company. For this the author mobilizes concepts already developed by many authors, sometimes very different, from Williamson to Becker, on investment in specific capital (to the company in the case of work, but also to the couple in the case of a marriage, at Becker) and the situations of hold-up which can result from it.
What the author does not really tell us is to what extent his field study is generalizable and if the world of traders is exemplary in that it makes it possible to account for all the bonuses or on the contrary if it remains an aberrant point in the incentive system.
The last issue of December 5 of the review Economic problems is devoted to the same question (“ What remuneration for business leaders ? ») And provides complementary lighting to the question posed by Godechot.