Asked by anonymous
There are 100 workers in the economy and all must choose to work either a risky or safe job. Worker 1's reservation price for accepting the risky job is $1, worker 2's reservation price is $2, and so on. There are only 10 risky jobs available. What is the equilibrium wage differential between safe and risky jobs.
Answers
Answered by
economyst
If the wage rate for non-risky is w, the wage rate for risky should be w+10.