Wage determination

There are five pillars that wage determination rest on they are:

1. MTA seeks to maximize ‘Making Every Dollar Count - former CEO Jay H Walder theory’ and we the blue collar seek to maximize utility
2. Blue collar and MTA have perfect information about wages and job opportunity in the labor market
3. Blue collar in the labor market are identical with respect to skills and productivity - jobs offered  are identical with respect to working conditions and other non wage attributes.
4. The labor market is composed of many individuals
5. All jobs are open to competition no institutional barriers inhibit mobility of workers from one job to another. Cost of mobility are zero. 

Given these pillars the perfectly competitive model gives rise to one of the most important predictions in labor economics - the law of one wage. The law of one wage states that in competitive labor market the competition between buyers and sellers will result in the establishment in the market of one uniform ‘going’ wage that will be paid by all employers and received by all workers.