In Japan we have ongoing debates on how much doctors should be paid. Currently physicians are paid about 40000-80000GBP per year, unsurprisingly well above the national average wage. This has apparently upset some Japanese including Treasury who decided to cut the health budget for this year so that the doctors’ wage will be closer to the national average. The union for physicians disagrees, claiming that their wages are not overly high considering that they work much longer than average workers and always have risks of lawsuit when things go wrong. Besides most of public hospitals are in red and facing financial catastrophe.
When I discuss this issue with others, I often struggle to explain what is the “right” wage for a profession. Perhaps everybody (except for doctors) would be happy if they get paid the national average, but then the public will have no right to complain if the doctors refuse to work more than the national average. Considering the number of doctors and hospitals in Japan, the healthcare system will collapse if doctors work only 40 hrs a week.
The problem, perhaps, is that it is unclear who should determine the salary for doctors. One argument would be it should be the public whose money funds the healthcare. So maybe Japanese should have a referendum to determine the salary. If that is so, however, salaries for other public sectors, even Prime Minister’s, should be voted by the public. I know it is not going to happen soon, but at least I can try it on the web…
I think it’s going to be hard for the general public (of any country) to understand the value of any one profession in their society and, therefore, whether one category of professionals should be paid more or less than another. This is in the assumption that value of a profession in the society, difficult to quantify per se, should correspond to a better pay. Debatable by some.
Interestingly, in the US, salaries may vary by a few orders of magnitude. The “biggest” guys/professors in the US Academia may earn a salary with five zeros but arguably not with the first digit being any different than 1. Yet…the biggest guys in the Financing world, or the stock market, may make a lot more than that. Orders of magnitude more sounds a lot more to me! Is a public referendum going to stop this trend? I am puzzled.
public referendums would only work for publicly paid employees. I don’t see how you can coerce a private company into paying a lower salary. All that would lead is to creative ways to hide pay.
Massimo and Farhat, thanks for your comments. The idea the Japanese Treasury have is to first lower the health budget, so that the income of hospitals will drop and so should the doctors’. They will continue cut the spending until the doctors’ wages become “reasonable”. The problem I tried to address was who should decide what is a “reasonable” pay. I am hoping someone with knowledge in economics could comment on this since I have no idea.