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Author Question: What is an efficiency wage and what effect does it have in the labor market? What will be an ... (Read 53 times)

nenivikky

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on: Jun 29, 2018
What is an efficiency wage and what effect does it have in the labor market?
 
  What will be an ideal response?

Question 2

Economic growth is slow or absent in some economies because those lack
 
  A) political freedom.
  B) democracy.
  C) a strong government.
  D) cultural freedom.
  E) economic freedom.


Hdosisshsbshs

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Reply #1 on: Jun 29, 2018
Answer to Question 1

An efficiency wage rate is a wage that is set by a firm above the equilibrium wage rate in order to motivate the firm's workers to work hard. The idea is that workers will work hard in order to keep their jobs because they know that if they are fired the (equilibrium) wage rate they are likely to get at a new job will be less than the efficiency wage. An efficiency wage is one of the factors that push the wage rate above its equilibrium and thereby create unemployment.

Answer to Question 2

E


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nenivikky

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Reply #2 on: Jun 29, 2018
Thank you :)


Hdosisshsbshs

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Reply #3 on: Jun 29, 2018
Happy to help you


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