A difference in wages between a highly-educated worker and a less-educated worker is
A) a compensating differential for the cost of becoming educated.
B) a signal that the market is indifferent to a worker's level of human capital.
C) considered unfair by economists.
D) considered unfair by everyone.

Question

Quizplus · Accepted Answer

The wage differential between a highly-educated worker and a less-educated worker is a compensating differential for the cost incurred by the highly-educated worker in becoming educated. This difference reflects the higher productivity and skills possessed by the highly-educated worker, and is not considered unfair by economists.

A Difference in Wages Between a Highly-Educated Worker and a Less-Educated