“The higher real wages earned by American workers primarily reflect the fact that Americans have a greater inherent ability to produce goods and services than do foreign workers.” Evaluate

What will be an ideal response?

There is no evidence to suggest that there is an inherent superiority among American workers. However, they have large amounts of capital per worker with which to improve their productivity over many of their less fortunate foreign counterparts. The high productivity in the United States is also related to the abundance of natural resources, high level of technology, and quality of labor in terms of health, education and training, and work attitudes, as well as a relatively stable business environment. It is this high level of productivity resulting from the various factors named which enables American workers to earn high real wages.