11.6 Chapter 19 - Click to edit Master subtitle style Econ...

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Unformatted text preview: Click to edit Master subtitle style Econ 101 Introduction to Microeconomics Professor Richard V. Burkhauser 19 Earnings and Discrimination Econ 101 Professor Burkhauser Econ 101 Professor Burkhauser Key Concepts compensating differentials, p. 414 human capital, p. 418 efficiency wages, p. 422 discrimination, p. 422 Econ 101 Professor Burkhauser Econ 101 Professor Burkhauser Differences Differences in Earnings in the United States Today The typical physician earns about $200,000 a year. The typical police officer earns about $50,000 a year. The typical farm worker earns about $20,000 a year. Econ 101 Professor Burkhauser Econ 101 Professor Burkhauser Differences What causes earnings to vary so much? Wages are governed by labor supply and labor demand. Labor demand reflects the marginal productivity of labor. In equilibrium, each worker is paid the value of his or her marginal contribution to the economys production of goods and services. Econ 101 Professor Burkhauser...
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11.6 Chapter 19 - Click to edit Master subtitle style Econ...

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