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Wage Theories: Wage Fund Theory Residual Claimant Bargaining Theory The Subsistence Theory of Wages
Wage Theories: Wage Fund Theory Residual Claimant Bargaining Theory The Subsistence Theory of Wages
2. Residual claimant
3. Bargaining theory
5. Marginal-productivity theory
Wage Fund theory
oThis theory was developed by Adam
Smith (1723-1790). His theory was based on
the basic assumption that workers are paid
wages out of a pre-determined fund of wealth.
oThe wage-fund theory held that wages
depended on the relative amounts of
capital available for the payment of
workers and the size of the labour force.
Wages increase only with an increase in
capital or a decrease in the number of
workers.
Residual claimant theory of wages