backward-sloping supply curve for labour
backward-sloping supply curve for labourThe preference for increased leisure over increased remuneration. Thus, when wage incentives are offered to improve productivity, labourers respond by working shorter hours to earn the same money rather than harder or longer to earn more money.
Max Weber discussed this phenomenon in General Economic History (1919–20), citing it as an example of ‘economic traditionalism’, and arguing that ‘at the beginning of all ethics and the economic relations which result, is traditionalism, the sanctity of tradition, the exclusive reliance upon such trade and industry as have come down from the fathers. This traditionalism survives far down into the present; only a human lifetime in the past it was futile to double the wages of an agricultural labourer in Silesia who mowed a tract of land on a contract, in the hope of inducing him to increase his exertions. He would simply have...
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