ECO100Y5 Chapter Notes - Chapter 14: Podcast, Marginal Product, Marginal Utility
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ECO100Y5 Full Course Notes
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I(cid:374)(cid:272)o(cid:373)es & wages; produ(cid:272)tivity; why so(cid:373)e ear(cid:374) more tha(cid:374) others; la(cid:271)our u(cid:374)io(cid:374)s. Physicians make ,000 per year but fast food cooks make ,000 per year. Median nominal wages & average income over time. The nominal wage adjusted for the effects of inflation. The idea is hold the value of a dollar constant. Therefore, an increase in real wages means you can buy more than you did before. Unfortunately, real wage growth has been relatively flat for almost 40 years. Most workers receive additional compensation in the form of fringe benefits such as health insurance, sick pay, retirement benefits & days off for vacation. These days, fringe benefits are not trivial, as they make up ~30% of total income. Thus, the price of labour should include direct & indirect payments made in exchange for it. Using demand & supply to explain wage variance. Workers are producers of labour & firms are consumers of labour.
