What is an isoquant? What is production rate? How does a firm determine how much labor it should purchase? Which country in Europe has the largest labor force? What is efficiency wage? What role do labor unions play in the labor market?
In this paper, I explore the consequences of extending the number of firms within an efficiency-wage competition setting by showing that the shape of the effort function is crucial in determining key features of the economy. Specifically, when workers are endowed with a concave (sigmoid) effort ...
aSome economists argue that efficiency wages lead to higher rates of unemployment. Because wages are set above the equilibrium wage rate, a consumer surplus arises. A consumer surplus, in this case, is the difference between what the employer is willing to pay an employee and the actual wage ...
When do firms pay efficiency wages? What is the relationships between moral hazard and efficiency wages? Suppose each family in the United States earned an equal money income. What would be the effect? Which of the following are potential problems with using the minimum wage as a poverty-fighti...
A.Thisisonereasonbehindtheindustry?sdrive todeveloprobotics. B.thereisanappealforinnovationandefficiency. C.robotscouldleadto moreadvancedfarming practices. D.The developmentofroboticsin agriculture couldleadtoamassiverelieftothegrowers. E.Theyaretooeasilybruised(碰伤),ortoohard forheavyfarm machinerytolocat...
In questioning the validity of the neoclassical model, it is argued that variables such as the strength of trade unions, the size of the informal sector and national rates of poverty are better explanations for wage levels. Therefore, to improve wages and conditions, workers and their ...
Read our guide to learn what a payroll ledger is and why it’s essential for tracking employee compensation efficiently—plus, try our free template.
Finally, the third type of merit increase is, as mentioned above, an increase in wage based on both cost of living and merit. Many companies offer cost of living increases to their employees every year. This means that every employee will have an increase in pay, whether it is based on...
Is a Market Economy Good or Bad? Most economists say that a market economy system is best able to deliver a high quality of life to most of its citizens. Its benefits include increased efficiency, steady economic growth, and motivation for innovation. Its potential downsides include the risks ...
Sign of an Overheating Economy A low unemployment rate, on the other hand, means that the economy is more likely to be producing near its full capacity, maximizing output, driving wage growth, and raising living standards over time. However,extremely low unemploymentcan also be a cautionary sign...