According to economists, Britain has seen barely any growth in output per worker

Question

According to economists, Britain has seen barely any growth in output per worker for at least a decade. The long run result of this stagnant worker productivity (cet. par.) is likely to be:

According to economists, Britain has seen barely any growth in output per worker for at least a decade. The long run result of this stagnant worker productivity (cet. par.) is likely to be:

A) dramatically falling real wage. B) rising real wage due to decreases in capital.
























C) little, to no change in real wages. D) a rising real wage to attract more workers .

Explanation / Answer

Ans. This is an interesting question.

See , answer to this question may vary because different economists uses different theories to judge the Long Term Impact of Stagnant Workers Productivity in the Economy :

According to my research and understanding , the answer would be : a) Dramatically falling Real Wage.

After 2007 , Productivity of workers in UK Remained merely constant , hence wages didn't rise as much. Now in long run also , if productivity remains constant , Wages won't rise as much as they should have. Hence treating the Future Wages with the Inflation would give us a Dramatic Fall in Real Wage.

Some scholars also argue that in order to induce the workers to be more productive , companies may hike the wages and this would Increase the Real Wage. This option can also be a prospective impact.

I hope you understood the answer. Do ask in case of any doubt.

A Thumsup would be Highly Appreciated !!

Best of Luck !! Keep Chegging !!

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