An Empirical Framework for the Efficiency-wage Model: Use of Micro Data for Nigeria

Since the efficiency-wage theory has graduated from a hypothesis to a model, there is the need for an established empirical foundation as the basis for continued confidence in the model's practical validity. To augment the efforts already made in this regard for the industrially developed labour markets, contributes an in-depth empirical analysis of the model by explicit use of Nigerian data as a prototype of the less developed countries. The results show a very strong case for the empirical validity of the model.