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Theories of Income Distribution

Module. Micro: Econ:. 37. 73. Theories of Income Distribution. KRUGMAN'S MICROECONOMICS for AP*. Margaret Ray and David Anderson. What you will learn in this Module :. Labor market applications of the marginal productivity theory of income distribution.

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Theories of Income Distribution

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  1. Module Micro: Econ: 37 73 Theories of Income Distribution • KRUGMAN'S • MICROECONOMICS for AP* Margaret Ray and David Anderson

  2. What you will learnin thisModule: • Labor market applications of the marginal productivity theory of income distribution. • Sources of wage disparities, including the role of discrimination.

  3. The Marginal productivity Theory of Income Distribution • According to MP theory, the division of income among factors of production is determined by MP • Can we use MP theory to explain why some workers are paid more than others?

  4. Marginal Productivity and Wage Inequality • Compensating differentials • Differences in talent • Human capital

  5. Other Sources of Wage inequality • Market Power • Efficiency Wages • Discrimination

  6. Is the MP Theory Really True? • Objections to MP theory • Evidence • Fairness • Does MP Theory work?

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