Ch. 12 - Why Wages Vary Flashcards
What is Human Capital?
The accumulated knowledge and skills that make a person more productive
What is a signal?
An action taken to credibly convey private information, or information that is hard for someone else to verify
What is an efficiency wage?
A higher wage paid to encourage greater worker productivity
What is a compensating differential?
The differences in wages reqired to offset the desirable or undesirable aspects of a job
What is a monopsony power?
A business using its bargaining power as a major buyer of labour to pay lower prices, including lower wages
What is discrimination?
Treating people differently based on different characteristics (ex. gender, race, etc)
What are the 3 types of discrimination?
- Prejudice
- Implicit Bias
- Statistical Discrimination
What is prejudice?
A preconceived bias against a group that’s not based on reason or experience
What is implicit bias?
Judgements shaped by the unconscious attribution of particular qualities to specific groups
What is statistical discrimination?
Using observations about average characteristics of a group to make inferences about an individual
What are general skills?
Skills useful to many employers
What are job-specific skills?
Skills that are only useful in a job with one particular employer
What is extrinsic motivation?
The desire to do something for its external rewards such as higher pay
What is intrinsic motivation?
The desire to do something for the enjoyment of the activity itself
