In the context of the theories of education and wages, what is a key difference in the policy implications of the human-capital theory versus the signaling theory?
Explanation
This question tests the student's ability to think about the different real-world policy implications that follow from the two competing theories of education's value.
Other questions
What is a 'compensating differential' in the context of labor economics?
According to the human-capital theory, why are workers with more education paid more?
What are the two market characteristics necessary for the 'superstar phenomenon' to arise?
According to the case study 'The Increasing Value of Skills' and Table 1, how did the earnings premium for female college graduates change from 1980 to 2008?
The case study 'The Benefits of Beauty' by Hamermesh and Biddle suggests that, on average, a person of average looks earns how much more than a person considered less attractive?
Which of the following is NOT listed as a reason for above-equilibrium wages?
What is the primary difficulty in measuring the extent of labor-market discrimination by simply observing wage differences between groups?
In the study by Bertrand and Mullainathan on discrimination in hiring, what was the key finding regarding résumés with names like 'Lakisha Washington' versus names like 'Emily Walsh'?
According to economic theory, how can a competitive market eventually reduce wage differentials that arise from employer discrimination?
Under what two conditions can discriminatory wage differentials persist in a competitive market?
The case study of segregated streetcars in the early 20th-century American South found that streetcar companies often:
Which of the following is an example of a compensating differential?
What does the 'signaling' theory of education propose?
According to Table 2 on page 405, what was the wage gap between the median white woman and the median white man in 2008?
According to the textbook, which of the following professions is LEAST likely to have a 'superstar'?
Which of the following is NOT one of the three factors identified in Chapter 19 as important but difficult-to-measure determinants of wages?
A labor union, by bargaining with employers, can raise the wage for its members. According to studies cited in Chapter 19, by approximately how much do union workers earn more than similar nonunion workers?
What is a major consequence of wages being set above the equilibrium level due to minimum-wage laws, unions, or efficiency wages?
Two main hypotheses are proposed to explain the increasing earnings gap between skilled and unskilled workers. What do both hypotheses suggest has happened?
According to the case study on discrimination in sports, why might a discriminatory wage gap have persisted in professional basketball?
In the research by Niederle and Vesterlund on gender differences in competition, what was the primary reason more men than women chose a tournament-style payment system?
What is the economic argument for why a professor might earn less than a doctor, even with similar amounts of education?
The 'In the News' article 'The Human Capital of Terrorists' suggests that better-educated terrorists are more 'productive' because they:
Which of the following wage differences is LEAST likely to be the result of a compensating differential?
According to Table 1, in 1980, a male college graduate earned approximately how much more than a male high school graduate?
The study on the economics of beauty suggests that one interpretation of the 'beauty premium' is that good looks are a form of:
One of the two main hypotheses for the widening gap in earnings between skilled and unskilled workers involves international trade. This hypothesis suggests that the U.S.:
A firm that pays an above-equilibrium wage to increase the productivity of its workers is said to be paying:
According to the analysis in Chapter 19, if a large number of discriminating firms exist in a competitive market, what provides an incentive for a new firm to enter and not discriminate?
The median black woman in the U.S. in 2008 was paid 13 percent less than the median white woman. What does this statistic, by itself, tell us about discrimination?
In 2008, the earnings premium for a male college graduate was 88 percent. What does this mean?
Which factor is NOT a potential reason for the persistence of a discriminatory wage differential in a competitive market?
The theory of efficiency wages suggests that a firm might pay above-equilibrium wages to:
When economists conclude that unexplained variation in wages is due to 'ability, effort, and chance,' what does this imply?
If a construction worker earns a higher wage than an office worker with the same level of education, this wage difference is most likely an example of:
Why might a study find a wage gap between two groups even after controlling for years of education?
If customer prejudice is the source of a discriminatory wage differential, what would be observed in the market?
What is the primary difference between the human-capital and signaling views regarding a policy that increases everyone's level of education?
In 2008, the median black man was paid 21 percent less than the median white man. The chapter suggests a non-discriminatory reason for part of this gap is that:
The 'In the News' article about gender and competition found that while men and women performed equally on a task, men were twice as likely to choose a tournament pay scheme. What percentage of men chose the tournament?
What does the existence of the superstar phenomenon imply about the distribution of income?
If a company offers higher pay for employees who work in a remote, undesirable location, this is an example of:
Which of the following would be an example of government-mandated discrimination?
The earnings gap between skilled and unskilled workers has widened. The technological change hypothesis suggests this is because technology like computers:
Why do economists believe that effort and chance play a large role in determining wages?
If a government requires all firms to provide a health insurance benefit to their workers, this policy will likely:
In the study of old baseball card prices, the finding that cards of black players sold for less than cards of comparable white players is evidence of:
A key conclusion of Chapter 19 is that differences in earnings in our economy can be attributed to:
According to the case study on men and women's choices in competitive environments, which group was more likely to be overconfident about their performance?