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A Critique of the Global Wage System

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  • Gernot Köhler
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    Abstract

    It is widely believed that international wage differences are a result of international productivity differences. That belief has been criticized by various economists. For example, Samir Amin observed: “Workers at the periphery are super-exploited . . . because the differential of wages (and incomes from non-wage labour in general) is much higher than the differential of productivities.” (Amin 1990, chapter 6) In the estimation of Prebisch, Singer, and Myrdal, “productivity increases that take place in developed nations are passed on to their workers in the form of higher wages and income, while most or all of the productivity increases that take place in developing nations are reflected in lower prices” (Salvatore 1987: 273) I would like to add a few observations of my own. My observations are influenced by the feminist critique of wages, which has established that wage differences between the sexes are frequently caused by discrimination, rather than by productivity differences. Following that line of reasoning, the thesis of this article is that international wage differences are, to a large extent, caused by discrimination, rather than by productivity differences.

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    Paper provided by Argentine Center of International Studies in its series Working Papers - Programa Teoría de las Relaciones Internacionales with number 014.

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    Handle: RePEc:cis:teoria:014

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    Keywords: international wage differences; productivity; discrimination;

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