According to the neoclassical theory of distribution, the wages paid to John Deere tractor assembly line workers are higher than those paid to fast food workers because assembly line workers
A)have college degrees, on average, whereas fast food workers usually do not.
B)produce a product of greater market value than do fast food workers.
C)work in a less stressful environment than do fast food workers.
D)are less likely to belong to a labor union than are fast food workers.

Question

Quizplus · Accepted Answer

According to neoclassical theory of distribution, wages are determined by the productivity and value of the product produced by the worker. Assembly line workers, such as those at John Deere, are assumed to produce a product of greater market value than fast food workers, which justifies their higher wages. Therefore, option B is the best choice.

According to the Neoclassical Theory of Distribution, the Wages Paid