Which of the following is an example of an efficiency wage?
A)an addition the government makes to some workers' wages in order to reduce poverty
B)an equilibrium wage paid to workers who work part time and so are exempt from the minimum wage
C)paying higher wages to workers doing dangerous tasks
D)an above equilibrium wage paid to workers to reduce shirking

Question

Quizplus · Accepted Answer

An efficiency wage is a wage that is higher than the equilibrium wage in order to increase productivity and reduce shirking. Therefore, paying higher wages to workers to reduce shirking is an example of an efficiency wage. Choice A is an example of a redistributive policy, choice B is an example of an exemption from the minimum wage, and choice C is an example of a compensating wage differential.

Which of the Following Is an Example of an Efficiency