The Minimum-Wage, Insider-Outsider, and the Efficiency-Wage Explanations All Seek to Explain

question 64

Multiple Choice

The minimum-wage, insider-outsider, and the efficiency-wage explanations all seek to explain

• A)the increase in the employment-to-population ratio over the past 40 years.
• B)the trend in real wages over the past 40 years.
• C)why the labor market is always in a state of flux.
• D)why the real wage is above the equilibrium real wage.
• E)why there is a persistent excess demand for labor.

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Definitions:

Rent

A fee charged for the use of property or land, typically paid monthly by tenants to landlords.

Economic Rent

Income earned from the possession of a unique asset or advantage not due to individual effort or investment, such as land ownership or patents.

Unearned Surplus

Income derived from investments rather than from work or productive activity.

Henry George

Henry George was an American political economist and journalist who advocated for the "Single Tax" on land, arguing that this would reduce economic inequalities and promote social justice.