In the efficiency wage theory of labor, an increase in wages is justified by a resulting:

Question

Quizplus · Accepted Answer

In the efficiency wage theory, an increase in wages is justified by an increase in productivity and the desire to work harder. This is because higher wages provide an incentive for workers to put in more effort and increase their productivity, which can ultimately benefit the firm. Increased standard of living and attractiveness of the work environment may result from higher wages, but they are not the primary justifications for the increase.

In the Efficiency Wage Theory of Labor, an Increase in Wages