Efficiency wages will raise the quantity of labour supplied to the market.

Question

Quizplus · Accepted Answer

Efficiency wages refer to the practice of paying workers a higher wage than the market equilibrium in order to increase their productivity and decrease turnover. This can increase the quantity of labour supplied to the market by making the job more attractive and reducing the incentive for workers to seek employment elsewhere. Therefore, efficiency wages can raise the quantity of labour supplied to the market.

Efficiency Wages Will Raise the Quantity of Labour Supplied to the Market