[jondubois]

>> Why are some firms paying better than others? It could be that some are just more generous — paying their workers higher amounts than other firms pay for the same work — although that would surprise economists

I'm not an economist, but as someone who has worked for many different companies in the software industry, I don't find this 'generosity' hypothesis surprising at all. Managers usually don't have a clue who to promote so they just promote their friends or those who are liked by the rest of the team (for reasons unrelated to skill).