Which of the following is an example of an efficiency wage?
A)A high wage paid to compensate for dangerous work such as coal mining
B)An above-equilibrium wage offered by a firm to attract a more talented pool of job applicants
C)A wage below the minimum wage but supplemented by customer tips
D)A high wage paid to a college graduate for a high-skill job such as electrical engineering

Question

Quizplus · Accepted Answer

Efficiency wages are above-market wages paid by firms to increase worker productivity, attract better applicants, reduce turnover, and/or motivate employees. Option B directly refers to paying above-equilibrium wages to attract better talent, which aligns with the concept of efficiency wages. Options A, C, and D describe scenarios that are not primarily focused on the efficiency wage theory's objectives.

Which of the Following Is an Example of an Efficiency