Christmas bonus and staff morale

Does a Christmas bonus improve staff morale?

Executives with large bonuses tend to have greater job satisfaction. Does this mean that the bonuses are effective?

Click Slice. There is little relationship between job satisfaction and bonuses within any salary range.

The marginal relationship was caused by a lurking variable, Salary.

Use this diagram to explain that the marginal relationship between Y and X in a scatterplot may be misleading if the data are observational.

Executives with large bonuses tend to have greater job satisfaction.

However click Slice and drag the slider. There is little relationship within any salary group — Job satisfaction and Bonus are uncorrelated conditional on Salary, even though staff with large salaries also tend to have higher job satisfaction and get big bonuses.

The marginal relationship was caused by a lurking variable, Salary.


The data are artificial.