Four Employers Have Justified Their Actions as Follows

question 30

Multiple Choice

Four employers have justified their actions as follows. Whose logic is not consistent with the logic of efficiency wage theory?

• A)Jay develops a new assembly line technology that limits the amount of shirking workers can do, so he reduces what he pays his employees so as to make it closer to the equilibrium wage.
• B)Kay pays her workers less than the equilibrium wage so they won't have the time or money to look for work somewhere else.
• C)Ray pays his workers in a developing country more than the going wage hoping that they will get a better diet and so be more productive.
• D)None of the above is consistent with the logic of efficiency wage theory.

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