Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 19 - Part VI - Earnings and Discrimination - Questions for Review - Page 410: 5

Answer

Three reasons for above-equilibrium wages are minimum wage laws, unions, and efficiency wages.

Work Step by Step

Minimum wage laws protect workers who are unskilled and inexperienced. Unions are worker associations who can threaten strikes (a worker shortage). Efficiency wages are paid to workers by companies to increase the productivity of workers.
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