Wages of efficiency

In economy, the wages of efficiency is a concept developed within the framework of the Nouveau keynesianism (in particular by the economists Carl Shapiro and Joseph Stiglitz in 1984) to explain part of the Chômage market economies contemporary.

In the model of the wages of efficiency, the origin of imbalance is in a problem of access to information: employers not being able to know perfectly the furnished effort by the employees in their work and in particular if they provide the maximum effort. In order to incite them to provide a maximum effort, the employer thus will pay the employee a little more than until he can wait in another company: these wages higher than the wages of the market are the wages of efficiency . The employee will thus may find it beneficial any required the maximum of effort in order to remain in the company which pays it more. Contrary if its wages are on the level of the equilibrium market price, the employee does not lose anything to change employment and thus can " relâcher" its efforts with work: it is the wages of reservation . According to this theory, the standard of wages thus maintains an increasing relation with the Productivité the employee.

However, the other employers employing the same strategy, all the wages will be increased (each employer wanting to make sure of the motivation or efficiency of its clean paid). That will result in to decrease the request on the Job market because work will be more expensive and the less inclined employers to engage. The analysis keynésienne gave the name of balance of under-employment to this imbalance of the resulting job market in an massive unemployment.

This theory plays a big role in the analyzes economic Job market.

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