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Imagine two jobs, A and B, which require the exact same set of skills. We observe that A is a much more enjoyable job
Imagine two jobs, A and B, which require the exact same set of skills. We observe that A is a much more enjoyable job to hold, and indeed the vast majority of people would rather work in job A than job B, even if the wages for the two jobs were the same. Other than A being more enjoyable, the jobs are the exact same. We also observe that job A pays more than job B. What would the theory of compensating differentials say about these two observations?
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