Kingsley Davis and Wilbert Moore were a pair of sociologists who authored the Davis Moore Thesis in a paper called "Some Principles of Stratification," written in 1945. Their thesis held that some stratification is functionally necessary for society.
IN CONTEXT
All human societies have exhibited social stratification in some form. Why is this? Davis and Moore reasoned that it was functional for society. In 1945, at the time of their writing, World War II was ending. They were entering a period of relative harmony and stability in American society. Functionalist thinking was very popular in that time period, and one of the most famous sociologists, Talcott Parsons, would develop his ideas of functional social systems during this time frame. Therefore, it was natural to think about social stratification as functional for society, as well.
How might social stratification be good for society?
Davis and Moore reasoned that when you consider the division of labor in society, and the plethora of empty structural positions in the division of labor that people fill, some of these positions are more or less functional for society as a whole. By more or less functional, this means that some positions are more important or more critical for the functioning of society than others.
Davis and Moore reasoned that compensation is due to tasks that are more functional. The more functionally important and critical the task is for society, the more you're going to be rewarded. This explains stratification and the reason why the U.S. does not have a more egalitarian society--egalitarian being equal--because different levels of compensation attract the brightest minds into the most difficult and complex jobs, e.g., a doctor or lawyer. In order to entice these people to voluntarily incur all of the advanced levels of training and education and foregone income because of the schooling required, you need to offer higher compensation.
According to Davis and Moore, this is the structural reason why stratification exists. It exists because there is a need to induce people to go into the most complex, highly functional occupations for society. If everybody got equal compensation for varying degrees of work, then what incentive do you have to incur all the extra cost, time, etc., when you could get rewarded equally for something that is more easily attained.
Davis and Moore provide a structural reason for why there is social stratification, but they don't speculate as to what financial amount society should attach to each position. Each individual society decides that on their own. The important idea is that the most functional occupations for society are rewarded financially in terms of money, status and prestige.
Source: This work is adapted from Sophia author Zach Lamb.