Differences in marginal revenue products are the most important factor in explaining wage differences.Other factors that explain wage differences include all but one of the following.Which factor does not help explain differences in wages?

Question

Quizplus · Accepted Answer

Cognitive differentials do not help explain differences in wages as they refer to differences in mental abilities or skills, which are typically accounted for in the marginal revenue product. The other factors, such as compensating differentials, discrimination, and labor unions, are recognized as influencing wage differences.

Differences in Marginal Revenue Products Are the Most Important Factor