IN CONTEXT
Markets and firms
Joseph Stiglitz (1943–)
Carl Shapiro (1955–)
1914 During a recession US car manufacturer Henry Ford announces that he is doubling the pay of his workers to $5 a day.
1920s British economist Alfred Marshall suggests the idea of efficiency wages.
1938 The Fair Labor Standards Act introduces a minimum wage in the US.
1984 Carl Shapiro and Joseph Stiglitz suggest that efficiency wages discourage shirking.
1986 US economists George Akerlof and Janet Yellen suggest social reasons for paying efficiency wages, such as boosting morale.
US economists Carl Shapiro and Joseph Stiglitz contend that firms pay ...
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