wage

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Related to Wage Theory: Human Capital Theory

Wage

An amount of money paid each hour to compensate an employee for the amount of time he/she spends working. Wages are paid for both skilled and unskilled labor. For example, one may pay an employee $8 per hour for working at a fast food restaurant or $45 per hour for highly trained work at a car factory. What distinguishes wages from salaries is the fact that wages are only paid for the hours worked; an employee is paid more if he works for more hours. Salaries, on the other hand, are the same whether one works five hours or 50. See also: Overtime, Minimum Wage.

wage

the money payment made to a worker, usually on a weekly basis, for the use of his or her labour. A worker's basic wage will depend on the hourly WAGE RATE and the number of hours worked. The latter is usually related to the number of hours specified as constituting the ‘basic'working week, but in some cases workers may be given a GUARANTEED BASIC WAGE to protect them against loss of earnings due to short-time working, and in other cases workers may be able to add to their basic wage by OVERTIME earnings. In addition to PAYMENT BY TIME, workers may be paid in proportion to their output under a PAYMENT BY RESULTS scheme. See PAY, MEASURED DAY WORK.

wage

the PAY made to an employee for the use of his or her LABOUR as a FACTOR OF PRODUCTION. Wages are usually paid on a weekly basis, and they depend on the hourly WAGE RATE and the number of hours that constitute the basic working week. In addition, employees can add to their basic wage by working OVERTIME.

As an alternative to workers being paid on the basis of hours worked (a ‘payment by time’ system), employees may be paid in proportion to their output (a ‘payment by results’ system).

In aggregate terms, wages are a source of income and are included as a part of NATIONAL INCOME. See SALARY, NATIONAL INCOME ACCOUNTS.

References in periodicals archive ?
Marx had of course contributed to this critique, but, as Lapides points out, Marx sought not only to refute this doctrine, but also "to provide a completely new framework for analyzing wage phenomena."(5) Lapides rounds out his discussion of the early literature on wage theory with a chapter on the early radical and social critics of political economy.
As a result, the efficiency wage rate does not vary over the business cycle under Solow's efficiency wage theory.
This article follows the efficiency wage theory, and seeks to explain substance abuse in the workplace using two key explanatory variables: the industry wage premium and the level of unemployment.
Nor does the efficiency wage theory explain why the average duration of unemployment in Europe has significantly exceeded that in the US and Japan since the mid-1970s, why labour and product market activities tend to move together in the US but not in Europe, or why unemployment in many countries varies less within a business cycle than from one cycle to the next.
"Wage Change and the Quit Behavior of Workers: Implications for Efficiency Wage Theory." Southern Economic Journal, 61: 133-148.
The formulation of the efficiency wage theory that has received the most attention over the years, however, has been the one that has focused on problems of incentives.
Efficiency wage theory offers an explanation for wage dispersion and for dual labor markets: the "wage-productivity nexus" is more important in some sectors of the economy than in others.
The efficiency wage theory has in recent years generally been regarded as a powerful vehicle for explaining why involuntary unemployment has persisted in the labor market.
Based on these tenets, the efficiency wage theory can answer the questions why the wage may exceed the market-clearing level and why involuntary unemployment is persistent.
One of the most influential models of wage-setting in low-income countries, nutrition efficiency wage theory, makes a very strong assumption about employers' information set.
The basic puzzle that efficiency wage theory is designed to solve is why wages appear to be rigid in the face of apparently unexploited gains from trade between firms and unemployed workers.
According to efficiency wage theory, employers pay artificially high wages to improve worker productivity.