Analyse and discuss whether the economic theory of wages can explain why there are inequalities in wage rates in a country.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2019). The mark or mark type is shown in brackets.

1. Discussion of determinants of wages. Candidates should explain the theoretical analysis and discuss the reason for higher wages and inequality in wage rates. These inequalities could occur not only in different occupations but within the same occupation.
2. The discussion should include reference to how the theoretical analysis accommodates the market forces of supply and demand but can be moderated by the influence of trade unions and government policy with possible influences on inequalities in wage rates.
3. L4 (18-25 marks): For a thorough analysis of theoretical wage determination with a clear discussion of the role of trade unions and their likely significance over other factors.
4. L3 (14-17 marks): For a competent explanation but with limited discussion of trade unions and their significance.
5. L2 (10-13 marks): For a correct but undeveloped theoretical analysis with very bald comment about the role of trade unions.
6. L1 (1-9 marks): For an answer that has some basic correct facts but includes irrelevancies and errors of theory.