Wage Determination - SS2 Economics Lesson Note

Wage determination refers to the process by which wages or salaries are set in a particular job market. The factors that influence wage determination include supply and demand for labor, the level of education and skills required for a job, and the bargaining power of workers and employers.

Employers will typically offer a wage or salary that is competitive with other employers in the same job market, in order to attract and retain skilled workers. In addition, unions and collective bargaining can also play a role in wage determination, as workers negotiate with employers for better wages and working conditions.