High salaries incentivize people to work hard  People respond to incentives, and one of the most direct incentives is a financial one. Higher salaries encourage people to deploy their labor. This benefits society by increasing tax revenues that can be spent on redistributive policies; for example, consider the much maligned investment banking profession. It is not uncommon for investment bankers to work 14 to 18 hour days, and to work at weekends; it is unlikely they would do this without the incentive of high salaries and bonuses, at least in the long run. The taxation on financial service providers (that rely on such hard work) and the workers themselves is significant; in 2010 in the UK, it was 11.2% of total tax receipts1. Furthermore, the deployment of labor may lead to more supporting workers being needed and therefore job creation.  1 PWC , "The Total Tax Contribution of UK Financial Services", December 2010