Asked by Manisha Reddy on May 07, 2024

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Which of the following factors is not relevant in explaining the persistence of wage differentials?

A) Labor immobility.
B) Compensating differences.
C) Free public education.
D) Noncompeting groups.

Wage Differentials

The variations in wage rates due to factors such as occupation, industry, location, and skills level.

Labor Immobility

A situation where workers find it difficult to move between jobs or geographical locations, often due to skills, qualifications, or other barriers.

Compensating Differences

Wage differentials that compensate employees for the desirability or undesirability of a job due to various factors, such as risk, effort, or location.

  • Understand the factors contributing to wage differentials and their persistence in labor markets.
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Verified Answer

JR
John Ryan O'RourkeMay 11, 2024
Final Answer :
C
Explanation :
Free public education is not relevant in explaining the persistence of wage differentials, as it provides equal education opportunities to all individuals and does not discriminate on the basis of socio-economic background. However, factors such as labor immobility, compensating differences, and noncompeting groups contribute to the persistence of wage differentials.