1. I once did a standard laboratory gift exchange experiment in which "employers" for several periods could set their wages at any level they wanted to (as long as they were at or above the required minimum) as in the standard lab experiment. This was followed by several periods where a minimum wage was introduced that was 25% higher than the average wage offered prior to introducing the minimum wage. This resulted in an increase in average effort levels at the new minimum that were well above the average offered at the previous minimum. How can you explain this using standard economic theory or any other plausible model of human behavior?