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> There are huge (irrational?) barriers for giving employees big raises or bonuses.

Since they exist at almost every company, I think it seems probable that it's rational. Here's a simple possible argument for their rationality:

Creating big barriers to large raises/bonuses discourages employees from sharing salary info, since there's little they can do about it. Furthermore, the more your employees are worrying about their salary, the less they're working.



> ...I think it seems probable that it's rational.

It's an example of bounded rationality: http://en.wikipedia.org/wiki/Bounded_rationality

The decisions seem rational given the perspective and limitations of the decision-makers.




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