This is actually similar to a well-known concept in economics, called the backwards bending supply curve.<p>Most things have a straight supply curve: if you pay more for a bushel of apples, more people are going to sell apples to you and you will get more apples. So price and quantity supplied are positively related--higher price, more quantity supplied.<p>Labor, however, has a backwards-bending supply curve. If you offer more and more money, you'll get more and more labor up to a point. At that point, however, increasing the price of labor further will actually <i>reduce</i> the quantity supplied due to laborers having diminishing returns on making more money. Normally, it's couched in terms of an hourly wage: you'll get more people willing to work more hours for $60/hr compared to $40/hr, but at $6000/hr, people will just put in half a day and then go shopping to add to their BMW collection or something.<p>A similar concept could, as you point out, be applied to salaries. Offering $200,000 a year over $100,000 a year will sure get you more salaried employee-years, but offering $20,000,000 will start you on the backwards-bending supply curve since people will start to retire early. At least in theory--in practice, a surprising number of people who earn millions of dollars a year keep working while they can. You never hear about a star athlete earning like 50 million in a year from salary and endorsements for two years and just saying, "I got all the money I need, to hell with football". Not even Fortune 500 CEO's seem to retire after a year or two, and god knows they can afford to. Maybe it's just that fun to have a job like that, maybe people <i>want</i> to work, maybe people who have those kinds of jobs can't exactly do the same thing for free and they don't know what else to do with their time, and maybe people just get used to living on that kind of salary so they have to keep working to keep up their lifestyle. But the concept does seem to apply to hourly wages, even if it doesn't apply as well to salaries.