Wage differentials exist in the long run because
A)labor markets are perfectly competitive
B)all jobs are equally attractive to all workers
C)the prices of goods vary by market
D)there are too many workers in the labor force
E)not all workers are equally qualified to perform every job

Question

Quizplus · Accepted Answer

Wage differentials exist in the long run because not all workers are equally qualified to perform every job. Different jobs require different levels of education, training, and experience, which can lead to differences in wages. Additionally, some jobs may be more dangerous, require working undesirable hours, or entail other undesirable features that may result in higher wages to attract workers. Hence, the answer is (E) not all workers are equally qualified to perform every job.

Wage Differentials Exist in the Long Run Because