MobLab
Instructions
Aa

Labor Market

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Payoff Computation

FIRMS:

Your payoff from hiring a worker is the difference between the revenue increase from hiring a worker and the wage you pay that worker.

WORKERS:

If you accept a job, your payoff is the wage you receive. If you do not accept a job, your payoff is the value from staying home.

Example

Paying an $8 wage for a job that increases firm revenues by $13:

Firm Payoff = Revenue Increase Wage
$5 = $13 $8
Worker Payoff = Wage
$8 = $8

A worker who values staying at home at $6 and does not accept a job:

Worker Payoff = Value of staying home
$6 = $6
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