Economics & Finance / Macroeconomics / Unemployment & Labor Markets

Your Paycheck's Hidden Secret: Why Your Boss Pays Round Numbers

Why do so many jobs pay exactly $10 or $15 an hour? It's not a coincidence, and it's not because workers demand it. This deep dive, based on groundbreaking NBER research, reveals a massive anomaly in the labor market. We'll walk through 15 key exhibits of evidence—from Amazon Mechanical Turk experiments to state tax records—to solve the mystery. The findings flip the script on corporate competence, exposing how widespread employer market power (monopsony) allows bosses to use lazy mental shortcuts when setting wages, protected by the fact that workers often have few alternatives. Discover the hidden power dynamics behind every round number on your paycheck.