Which of the following explanations argues that, in order to prevent shirking and lower job turnovers, the real wage will be purposely kept above the equilibrium wage resulting in unemployment?

Question

Quizplus · Accepted Answer

The efficiency-wage explanation argues that employers will purposely keep the real wage above the equilibrium wage in order to motivate workers to perform better, prevent shirking, and lower job turnovers. This can result in unemployment as more workers are willing to work at the higher wage, leading to a surplus of labor.

Which of the Following Explanations Argues That, in Order to Prevent