As an employee at a convenience store,Jorge is content to stay with his employer because his wage is 50 percent higher than the market rate.What economic theory could justify his employer's willingness to pay above the market rate?

Question

Quizplus · Accepted Answer

The efficiency wage theory justifies an employer's willingness to pay above the market rate. It suggests that paying higher wages can lead to increased productivity, lower turnover, and better morale among employees, making it a beneficial strategy for the employer.

As an Employee at a Convenience Store,Jorge Is Content to Stay