Question

In: Economics

When can we say that the wage difference between a worker without a college degree and...

When can we say that the wage difference between a worker without a college degree and a worker with a college degree is not a result of discrimination?

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Expert Solution

Discrimination between two people exists when they acquire same skills, knowledge,experience, education etc. However, when in a company high salary is given to a person who possesses higher skills, education, experience then he deserves to get pay higher than his colleagues who earns less income because he doesn't has the college degree. This discrimination is not unjust because a person with college degree is more efficient in performing task and his cognitive skills and knowledge is better than the person who doesn't possess college degree. However if both have same college degree and then they earn different income in that case wage difference is unjust. Whereas when one has college degree and other doesn't then it is justified to pay high wage because the college graduate has invested money and time for acquiring knowledge and is easy to train and he can become asset for the company. Therefore offering him high wage is a investment for firm as well because it can contribute more in the growth and development process as compared to the employee without college degree.


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