Question

THIS IS A 4 PART QUESTION. PLEASE ANSWER ALL PARTS. (From the Economic Way of Thinking, chapter 12)

Comparable worth" is the name of a movement that began in the 1980s to determine the worth of different jobs and then to adjust relative wage rates to the relative worth of those jobs. The movement gains most of its support from the belief that women are unfairly discriminated against in the labor market. The jobs at which some of them work (e.g. secretaries and nurses) are widely and unfairly regarded as 'women's jobs" and so are allegedly paid less than their "comparable worth". The comparison is with jobs traditionally held by men.

(a) Can a job have an inherent worth? Can you think of any situation where the worth of a job is not is value to some particular party in a specific situation.

(b) Imagine a medical clinic with 20 medical doctors, 1 nurse, and 1 laboratory technician. It is plausible to suppose that an additional nurse or lab technician could have more worth to the clinic in such a situation than an additional doctor?

(c) The worth or value that influences decisions is always marginal worth or value. Why is a secretary worth more to the economics department if it employs only one than if it employs eight? Describe a situation in which the worth of a secretary to the economics department would like be greater than the worth of an economist fully armed with a Ph.D.

(d) Why will an employer who follows the maximizing rule of Chapter 9 - do more if marginal revenue exceeds marginal cost, less if marginal cost exceeds marginal revenue - want to pay employees a wage equal to their marginal worth? What would be implied by the assertion that an employer ws paying employees less than their marginal worth?

Answer 1

a)Every job has its own importance.A job cannot be decided by the factor that it is done by men or women.It should be decided by the fact that how effectively it has been done

There can be a situation in a company where a gate- keeper is taking care of the people who are coming inside the company but it might be possible that the person has no importance in the company.But if any secret document goes out of the company then that person will be given importance because he keeps record of all persons entering the company.

b) It is obvious that doctors are given more importance but nurses are also very important in the clinic because she is the one who looks after the patient everyday till the discharge process is done.

c) If eight secretaries are appointed then all will be responsible for the working of the department.If one will not be there,effectiveness will not vary.But if there will be single sectary then he will solely be responsible for everything as economic department is concerned with financial decisions which can affect profitability of the company

If there will be a situation when company's financial condition is unstable then an economist can only advice on financial matters but secretary will have to decide all aspects related to money,employees,company,consumers.

d)when marginal revenue exceeds marginal cost then firm will be in profitable condition so employer can pay more wages to employees.But if marginal cost increased it means firm is incurring losses then it pays less to employees.

The assertion means marginal cost is more than marginal revenue.It means firm is investing extra money but returns are not accordingly.So employees are paid less.