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The last paragraph seems to assume that promotions always are (should be) desirable. I presume this is because we are primed with the notion that promotion = higher pay and higher social status. I wonder what would happen in an organization where the pay was significantly reduced every time one was promoted, perhaps to rise with experience at the new position, and where the worst was always "promoted".
Would this turn unstable from a group dynamic point of view, or would the mere greed of the promoted get them to push through (they are after all then in a position of authority/power) increased benefits for themselves personally, whether or not this would be beneficial for the organization in the whole....
/Mikael