A compensating differential refers to differences in
A) human capital levels of workers.
B) signaling differences of workers.
C) nonmonetary characteristics of jobs.
D) All of the above are correct.

Question

Quizplus · Accepted Answer

A compensating differential refers to the extra pay or benefits that workers are willing to accept in exchange for undesirable job characteristics such as dangerous working conditions, long hours, or unpleasant work environments. These job characteristics are nonmonetary in nature, which is why choice C is correct. Choice A and B refer to factors that may affect workers' wages or employment opportunities but are not directly related to compensating differentials.

A Compensating Differential Refers to Differences in