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Shirking
In labor economics, an efficiency wage is a wage paid in excess of the market-clearing wage to increase the labor productivity of workers.Mankiw, Gregory N. & Taylor, Mark P. (2008), ''Macroeconomics'' (European edition), pp. 181–182 Specifically, it points to the incentive for managers to pay their employees more than the market-clearing wage to increase their productivity or to reduce the costs associated with employee turnover. Theories of efficiency wages explain the existence of involuntary unemployment in economies outside of recessions, providing for a natural rate of unemployment above zero. Because workers are paid more than the equilibrium wage, workers may experience periods of unemployment in which workers compete for a limited supply of well-paying jobs. Overview of theory There are several reasons why managers may pay efficiency wages: * ''Avoiding shirking'': If it is difficult to measure the quantity or quality of a worker's effortand systems of piece rates or ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Labor Economics
Labour economics seeks to understand the functioning and dynamics of the markets for wage labour. Labour is a commodity that is supplied by labourers, usually in exchange for a wage paid by demanding firms. Because these labourers exist as parts of a social, institutional, or political system, labour economics must also account for social, cultural and political variables. Labour markets or job markets function through the interaction of workers and employers. Labour economics looks at the suppliers of labour services (workers) and the demanders of labour services (employers), and attempts to understand the resulting pattern of wages, employment, and income. These patterns exist because each individual in the market is presumed to make rational choices based on the information that they know regarding wage, desire to provide labour, and desire for leisure. Labour markets are normally geographically bounded, but the rise of the internet has brought about a 'planetary labour mar ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Efficiency Wage Shapiro Stiglitz
Efficiency is the often measurable ability to avoid making mistakes or wasting materials, energy, efforts, money, and time while performing a task. In a more general sense, it is the ability to do things well, successfully, and without waste. In more mathematical or scientific terms, it signifies the level of performance that uses the least amount of inputs to achieve the highest amount of output. It often specifically comprises the capability of a specific application of effort to produce a specific outcome with a minimum amount or quantity of waste, expense, or unnecessary effort.Sickles, R., and Zelenyuk, V. (2019).Measurement of Productivity and Efficiency: Theory and Practice. Cambridge: Cambridge University Press. . Efficiency refers to very different inputs and outputs in different fields and industries. In 2019, the European Commission said: "Resource efficiency means using the Earth's limited resources in a sustainable procent manner while minimising impacts on the envi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Reciprocity (cultural Anthropology)
In cultural anthropology, reciprocity refers to the non-market exchange of goods or labour ranging from direct barter (immediate exchange) to forms of gift exchange where a return is eventually expected (delayed exchange) as in the exchange of birthday gifts. It is thus distinct from the true gift, where no return is expected. When the exchange is immediate, as in barter, it does not create a social relationship. When the exchange is delayed, it creates both a relationship as well as an obligation for a return (i.e. debt). Hence, some forms of reciprocity can establish a hierarchy if the debt is not repaid. The failure to make a return may end a relationship between equals. Reciprocal exchanges can also have a political effect through the creation of multiple obligations and the establishment of leadership, as in the gift exchanges (Moka) between Big Men in Melanesia. Some forms of reciprocity are thus closely related to redistribution, where goods and services are collected b ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Altruism
Altruism is the concern for the well-being of others, independently of personal benefit or reciprocity. The word ''altruism'' was popularised (and possibly coined) by the French philosopher Auguste Comte in French, as , for an antonym of egoism. He derived it from the Italian , which in turn was derived from Latin , meaning "alterity, other people" or "somebody else". Altruism may be considered a synonym of selflessness, the opposite of self-centeredness. Altruism is an important moral value in many cultures and religions. It can Moral circle expansion, expand beyond care for humans to include other Sentience, sentient beings and future generations. Altruism, as observed in populations of organisms, is when an individual performs an action at a cost to itself (in terms of e.g. pleasure and quality of life, time, probability of survival or reproduction) that benefits, directly or indirectly, another individual, without the expectation of reciprocity or compensation for that ac ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Homo Economicus
The term ''Homo economicus'', or economic man, is the portrayal of humans as agents who are consistently rational and narrowly self-interested, and who pursue their subjectively defined ends optimally. It is a wordplay on ''Homo sapiens'', used in some economic theories and in pedagogy. In game theory, ''Homo economicus'' is often (but not necessarily) modelled through the assumption of perfect rationality. It assumes that agents always act in a way that maximize utility as a consumer and profit as a producer, and are capable of arbitrarily complex deductions towards that end. They will always be capable of thinking through all possible outcomes and choosing that course of action which will result in the best possible result. The rationality implied in ''Homo economicus'' does not restrict what sort of preferences are admissible. Only naive applications of the ''Homo economicus'' model assume that agents know what is best for their long-term physical and mental health. F ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Neoclassical Economics
Neoclassical economics is an approach to economics in which the production, consumption, and valuation (pricing) of goods and services are observed as driven by the supply and demand model. According to this line of thought, the value of a good or service is determined through a hypothetical maximization of utility by income-constrained individuals and of profits by firms facing production costs and employing available information and factors of production. This approach has often been justified by appealing to rational choice theory. Neoclassical economics is the dominant approach to microeconomics and, together with Keynesian economics, formed the neoclassical synthesis which dominated mainstream economics as "neo-Keynesian economics" from the 1950s onward. Classification The term was originally introduced by Thorstein Veblen in his 1900 article "Preconceptions of Economic Science", in which he related marginalists in the tradition of Alfred Marshall ''et al.'' to ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Wage Compression
Wage compression (also known as salary compression and pay compression) refers to the empirical regularity that wages for low-skilled workers and wages for high-skilled workers tend toward one another. As a result, the prevailing wage for a low-skilled worker exceeds the market-clearing wage, resulting in unemployment for low-skilled workers. Meanwhile, the prevailing wage for high-skilled workers is below the market-clearing wage, creating a short supply of high-skilled workers (and thus no unemployment of high-skilled workers). Perfectly competitive labour markets can still exhibit a wage compression effect. In a perfectly competitive market, workers of different skill levels receive different wages and workers of the same skill level will receive the same wage no matter which firm they work in. However, the distribution of the skills of employees may be wider than the distribution of their wages. Akerlof and Yellen (1990) propose a model that uses the fair-wage hypothesis ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Correlation And Dependence
In statistics, correlation or dependence is any statistical relationship, whether causal or not, between two random variables or bivariate data. Although in the broadest sense, "correlation" may indicate any type of association, in statistics it usually refers to the degree to which a pair of variables are '' linearly'' related. Familiar examples of dependent phenomena include the correlation between the height of parents and their offspring, and the correlation between the price of a good and the quantity the consumers are willing to purchase, as it is depicted in the demand curve. Correlations are useful because they can indicate a predictive relationship that can be exploited in practice. For example, an electrical utility may produce less power on a mild day based on the correlation between electricity demand and weather. In this example, there is a causal relationship, because extreme weather causes people to use more electricity for heating or cooling. However, in gen ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Reservation Wage
In labor economics, the reservation wage is the lowest wage rate at which a worker would be willing to accept a particular type of job. This wage is a theoretical representation of the hourly rate at which an individual values their own leisure time. A job offer involving the same type of work and the same working conditions, but at a lower wage rate, would be rejected by the worker. In this case, based on the reservation wage theory, the individual would be better off not working as they value their leisure at a higher rate than the wage they would receive for working. An individual's reservation wage may change over time depending on a number of micro and macro-economic factors, like changes in the individual's overall wealth, changes in marital status or living arrangements, length of unemployment, and health and disability issues. For example, an individual who has high household production activities may have a higher reservation wage, as the wage must exceed the benefit of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Dual Labor Market
Dual or Duals may refer to: Paired/two things * Dual (mathematics), a notion of paired concepts that mirror one another ** Dual (category theory), a formalization of mathematical duality *** see more cases in :Duality theories * Dual number, a number system used in automatic differentiation * Dual (grammatical number), a grammatical category used in some languages * Dual county, a Gaelic games county which competes in both Gaelic football and hurling * Dual diagnosis, a psychiatric diagnosis of co-occurrence of substance abuse and a mental problem * Dual fertilization, simultaneous application of a P-type and N-type fertilizer * Dual impedance, electrical circuits that are the dual of each other * Dual SIM cellphone supporting use of two SIMs * Aerochute International Dual a two-seat Australian powered parachute design Acronyms and other uses * Dual (brand), a manufacturer of Hifi equipment * DUAL (cognitive architecture), an artificial intelligence design model * DUAL algorithm, ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Marginal Productivity
In economics and in particular neoclassical economics, the marginal product or marginal physical productivity of an input (factor of production) is the change in output resulting from employing one more unit of a particular input (for instance, the change in output when a firm's labor is increased from five to six units), assuming that the quantities of other inputs are kept constant. The marginal product of a given input can be expressed as: :MP = \frac where \Delta X is the change in the firm's use of the input (conventionally a one-unit change) and \Delta Y is the change in the quantity of output produced (resulting from the change in the input). Note that the quantity Y of the "product" is typically defined ignoring external costs and benefits. If the output and the input are infinitely divisible, so the marginal "units" are infinitesimal, the marginal product is the mathematical derivative of the production function with respect to that input. Suppose a firm's output ''Y ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Pareto Optimality
In welfare economics, a Pareto improvement formalizes the idea of an outcome being "better in every possible way". A change is called a Pareto improvement if it leaves at least one person in society better off without leaving anyone else worse off than they were before. A situation is called Pareto efficient or Pareto optimal if all possible Pareto improvements have already been made; in other words, there are no longer any ways left to make one person better off without making some other person worse-off. In social choice theory, the same concept is sometimes called the unanimity principle, which says that if ''everyone'' in a society ( non-strictly) prefers A to B, society as a whole also non-strictly prefers A to B. The Pareto front consists of all Pareto-efficient situations. In addition to the context of efficiency in ''allocation'', the concept of Pareto efficiency also arises in the context of ''efficiency in production'' vs. '' x-inefficiency'': a set of outputs of go ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
