There absolutely is, as behavioral economics shows us. One of my last employers bought us coffee at our favorite coffee shop every day, and lunch once/week. We unanimously desired that over a commensurate raise. Why? Because the raise would have been so little it was rounding error in our paycheck — it would have been a non-noticeable improvement. In addition, having the raise, I would have been forced to chose whether the daily coffee and weekly lunch were worth it? There’d be a conversation with my wife about that spending, and I probably wouldn’t spend it — because spending it would then be an either/or decision, possibly with guilt attached. Thus, the money from the raise would effectively just disappear. By contrast, even if I didn’t get coffee everyday, the knowledge that I could — whenever I wanted, without having a discussion, making a decision, or carrying guilt — was worth more to me than having the small commensurate raise. This is something behavioral economists see all the time. It’s not limited to money, and is actually quite normal. All that said, the perk has to be something the individual desires for that to matter. There’s nothing exciting about getting $1,000 toward a gym membership if you hate gyms.

    John Metta

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    An unassuming hobbit who lives in a notebook with a pet fountain pen. Proud member of House Hufflepuff. Music maker, dreamer of dreams.

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