Exam 19: Earnings and Discrimination

Which of the following is an example of labor-market discrimination? You may assume that worker A and worker B have identical characteristics except for the ones listed. A firm offers a higher salary to worker A than worker B because worker A

Explain the role that consumers play in perpetuating discrimination in labor markets.

It is likely that efficiency wages will decrease employee effort.

Explain the theory that education acts as a signaling device. How does this contrast with the theory of education as an investment in human capital?

If we find that some schools direct females away from science and math courses, we have evidence of

A recent law school graduate is considering two offers to practice law, one in Louisiana and the other in Nebraska. The Louisiana bar exam is very difficult to pass compared with Nebraska's exam. Assuming all other things equal, the attorney would expect

The differences in the desirability of different jobs within a company could give rise to a compensating differential between workers.

If government regulations make a certain job less dangerous, then we'd expect that the supply of labor for that job would

Is measuring the effect of discrimination on wages relatively easy or relatively difficult? Explain?

Which of the following represents an example of labor-market discrimination?

One example of labor-market discrimination is that a firm may be less likely to interview a job candidate whose resume clearly indicates he is not a good fit for the job.

Evidence of discrimination in labor markets

Sometimes workers earn higher wages through chance.

Maria has just graduated from Princeton University and has applied for a job at a major bank. The bank decides to offer Maria a job because they perceive her degree from Princeton to be an indication of her high-ability. To which of the following views of education does the bank subscribe?

Economists who attempt to explain the increasing earnings gap between skilled and unskilled workers offer two main hypotheses:

Figure 19-2 -Refer to Figure 19-2. This figure depicts labor demand and supply in a nonunionized labor market. The original equilibrium wage is $10. If a labor union subsequently establishes a union shop and negotiates an hourly wage of $12.50, then there will be an excess

As a result of an increase in the earnings gap between skilled and unskilled jobs, the incentive to get a college education has been declining.

A compensating differential is a difference in wages due to higher levels of education or other forms of human capital.

Some economists suggest that increased international trade with countries that have a greater proportion of unskilled workers has led to an expanding wage gap between high-skill and low-skill workers in the United States.

Which of the following examples best describes the signaling theory of education?