Dear all,
As per theory, wage setting occurs based on marginal/average labor productivity.
Taking national aggregates of labor & capital, it stands that marginal and average productivity is much beyond the wages paid.
Any suggestions on possible reasons?
Thanks.
Check this links the articles maybe help you
http://www.ijsrp.org/research-paper-0816/ijsrp-p5675.pdf
https://editorialexpress.com/cgi-bin/conference/download.cgi?db_name=STCHANGE&paper_id=4
https://www.theatlantic.com/business/archive/2015/02/why-the-gap-between-worker-pay-and-productivity-is-so-problematic/385931/
http://www.ilo.org/wcmsp5/groups/public/---ed_protect/---protrav/---travail/documents/genericdocument/wcms_476157.pdf
The Wage-Productivity Gap seems huge.
Any theoretical justifications/possibilities?
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