Efficiency Wages and Industry Wages Differentials : A Comparison Across Methods of Pay
Efficiency wage considerations should be less important for piece-rate pay relative to time wages. Therefore, if industry wage differentials reflect efficiency wage factors, then these pay differences should be less sizable and have less explanatory power for piecework than for timework. We test this proposition using wage data for male production workers employed in the Swedish metalworking industries in 1985.
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