This new book, Chasing Stars by Boris Groysberg, is timely and important. It reports the author's research on the career paths and earnings of 'star' Wall Street analysts, and comprehensively busts the myth that these supposedly uniquely talented individuals are garnering the rewards to their distinctive skills when they earn such enormous amounts of money. The key finding of Groysberg's research, which covers more than a thousand people, is that when such 'stars' move to a new job, their performance deteriorates sharply. Their performance, it turns out, depends on their firm and not their unique individual talents. People who work for better teams deliver a better performance. Groysberg concludes: “Outstanding performance owes a good deal to the quality and culture of the firm.” (p323)

This is such an enormously important result because the claim that individual talents can be identified and should be rewarded in order to incentivise workers appropriately has shaped the intolerable top pay bubble and inequality of income in finance, and subsequently in the rest of the economy, including the public sector. If even in the profit-oriented world of finance, where results can be fairly clearly identified, individuals' own efforts don't explain their performance, then how much less relevant is individual 'performance management' in other types of business or in the public sector where outcomes are complex and uncertain? As Groysberg puts it: “If star research analysts' skills are not portable to otehr workplaces, it is highly unlikely that outstanding performance will rpove to be readily portable in other knowledge-based professions.” (p32)

Western governments have to grapple now with public sector deficits on the one hand, and on the other the social corrosion caused by excessive top pay (ratcheted up by the corrupt 'remuneration consultancy' business through which boards can ensure their comparability with their counterparts). Here is the start of the evidence base they need to fight back against excess in finance and hence elsewhere in the economy. I commend this book to any policy maker addressing this issue, including Will Hutton, chairing the government's commission on the high earners in the public sector. He won't make progress unless we can tackle the private sector and the financial world too, because people do compare what they can earn in different jobs. But Groysberg has done public service in exposing as false the claims of those in the financial sector who reckon they deserve their bloated pay.