So, when people are offered a huge reward for their labors (i.e. high pay) they make worse decisions than when they’re offered a moderate prize, Dan Ariely shows in this talk he gave at PopTech in 2009.
Money is a double-edged sword, Ariely argues, it’s a motivator and a stress-inducer. People who are completing a task that offers them a huge reward turn out to be too stressed to work as carefully and well as they would otherwise. So much for the theory that we need to allow for unlimited incomes to motivate innovators.
Now, according to this fascinating essay in the Atlantic, we learn that people who are ultra-rich ($25 million and up) and supposedly ultra-secure, turn out to be deeply unhappy. So much for the theory that money buys happiness.