Published by: sadikshya
Published date: 02 Jul 2021
Meaning of Wages refers to payments made for the services of labour used in the production process. Labours mean physical or mental efforts of human beings. Labour is a factor of production wages are paid on the basis of either time or amount of work done. According to Marshall ” Any type of reward human exertion, whether paid by the hour a day and longer unit of time were paid in cash is known as wage in economics.
There are mainly two types of wages. They are as follows.
Money and Nominal wage
Money or Nominal wage refers to the number of wages paid in money to the labourers for their physical or mental exertion. It is paid on the basis of hour, day, month and year to the workers under the account of wages are paid a sum of Rs 10000 per month. This amount is his money wages.
Real wages
Real wage refers to the purchasing power of money wages pay all other benefits and facilities provided by the employer to the labour. Here purchasing power of money wages refers to the number of goods and services that money wages can buy. Thus real wages measure the actual living standard of the workers the example of benefits and facilities are housing facilities, holidays, study, sick leave, free medical facilities, etc.