If we want higher real wages what must be true about productivity and market value of the products labor produces? 

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pohnpei397 eNotes educator| Certified Educator

If we want to have higher real wages, then the productivity of the workers who are earning the wages must be higher and the real market value of the products they produce must also be higher (all other things being equal).

In economic theory, wages correspond to the value of the output the workers produce.  If workers produce more value in an hour, they will be paid more for that hour of work.  One way to define the productivity of labor is to say that it is the value of the goods or services that are produced by one hour of labor.  If the workers are producing more value (which they have to do to get a higher wage) they are being more productive.  Therefore, higher real wages must be accompanied by higher productivity.

The same is true of the real market value of the products the workers make.  In order to earn higher wages, the workers have to produce goods that are worth more money.  That means that the real market value of the goods must be higher as well.