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Unformatted text preview: of that factor employed in the factor market as a whole 8. Marginal productivity theory of income distribution- Every factor of production is paid its equilibrium value of the marginal product 9. Compensating differentials- wage differences across jobs that reflect the fact that some jobs are less pleasant than others 10. Unions- organizations of workers that try to raise wages and improve working conditions for their members 11. Efficiency wage model- some employers pay an above equilibrium wage as an incentive for better performance 12. Time allocation- How many hours to spend on different activities 13. Leisure- Time available for purposes other than earning money to buy marketed goods 14. Individual labor supply curve- a curve that shows how the quantity of labor supplied by an individual depends on that individuals wage rate...
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- Spring '11