How Should Legislators Determine their Salary Level?

Abstract

How should legislators determine their salary level? After analyzing the arguments in favor of different salary-setting mechanisms, we argue that there are good normative reasons to favor those salary-setting methods that partially limit legislators' capacity to set their own salary. While we favor a middle way between unrestricted and completely restricted salary-settings mechanisms, we show that this path is not unique. Different partially restricted salary-setting mechanisms have substantially diverse policy implications. In particular, we argue that it is desirable to favor those salary-setting mechanisms that are able to attract high-quality citizens to run for office but that at the same time promote moderation in the magnitude of the salary adjustments.