Did Henry Ford Pay Efficiency Wages?
AbstractThe authors examine Henry Ford's introduction of the five-dollar day in 1914 in an effort to evaluate the relevance of efficiency-wag e theories of wage and employment determination. They conclude that t he Ford experience strongly supports the relevance of these theories. Ford's decision to increase wages dramatically is most plausibly the consequence of labor problems of the kind efficiency-wage theorists stress. The structure of the five-dollar day program is consistent wi th the predictions of efficiency-wage theories. There is vivid eviden ce that the introduction of the five-dollar day resulted in substanti al queues for Ford jobs. Significant increases in Ford productivity a nd profits accompanied the new regime. Copyright 1987 by University of Chicago Press.
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Bibliographic InfoArticle provided by University of Chicago Press in its journal Journal of Labor Economics.
Volume (Year): 5 (1987)
Issue (Month): 4 (October)
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Web page: http://www.journals.uchicago.edu/JOLE/
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