Question

For each of the following situations in which similar workers are paid different wages, give the most likely explanation for these wage differences. a. Test pilots for new jet aircraft earn higher wages than airline pilots. b. College graduates usually have higher earnings in their first year on the job than workers without college degrees have in their first year on the job. c. Full professors command higher salaries than assistant professors for teaching the same class. d. Unionized workers are generally better paid than non-unionized workers.

Short answer

Answer: Test pilots for new jet aircraft earn higher wages than airline pilots because they face higher risks and require specialized skills. Test pilots often fly unproven or experimental aircraft, exposing themselves to potentially dangerous situations. They may also need additional training and certifications to handle these unique circumstances. Therefore, the higher wages serve as compensation for the increased risk factors and specialized skills.

Step-by-step solution

a. Test pilots vs. Airline pilots

Test pilots for new jet aircraft earn higher wages than airline pilots because they face higher risks and require specialized skills. Test pilots often fly unproven or experimental aircraft, exposing themselves to potentially dangerous situations. They may also need additional training and certifications to handle these unique circumstances. Therefore, the higher wages serve as compensation for the increased risk factors and specialized skills.

b. College graduates vs. Workers without college degrees (first year on the job)

College graduates usually have higher earnings in their first year on the job compared to workers without college degrees because they have invested time and money in their education, which generally leads to acquiring more skills and knowledge. Employers may perceive them as more qualified or capable of performing at a higher level in the job, justifying their higher wages. Furthermore, having a college degree may open the door to more lucrative industries or positions which tend to have higher salaries.

c. Full professors vs. Assistant professors (teaching the same class)

Full professors command higher salaries than assistant professors for teaching the same class due to differences in experience, seniority, and qualifications. Full professors have generally published more research, have more years of experience in teaching and research, and hold more prestigious positions within their academic institutions. As a result, they enjoy higher salaries than assistant professors, who are often at the beginning of their academic careers and still building their reputation within their field.

d. Unionized workers vs. Non-unionized workers

Unionized workers are generally better paid than non-unionized workers because unions negotiate wages and benefits on behalf of their members. This collective bargaining power often results in higher wages, better working conditions, and more comprehensive benefits packages for unionized employees compared to their non-unionized counterparts. Additionally, unions may set minimum wage standards or salary scales for their members, leading to more consistent and potentially higher pay across the board for union workers.