Factors determine real wages

Under usual situation money wages determines real wages. The workers get higher rate of money wages, their purchasing power increase and as a result real wages tends to increase. But in case of persistent increase in price level, increase in money wages may not increase real wages.

Real wages depend on the purchasing power of money. When purchasing power of money increases real wages also increase and vice versa. When workers get other benefit like free housing, medical clothing education etc. facilities so real wages also increase and vice versa.

When workers get other benefits like free housing, medical clothing education etc. facilities so real wages of these workers have become high. On the other hand, if these facilities are not available, real wages of these workers have become high. On the other hand, if these facilities are not available, real wages fall. Many workers earn their income from other sources. For example teacher earns from tuition, police, income tax and personnel of other department of the government have extra sources of earning. So real wages of their workers have extra sources of earnings. When workers enjoy number of days as vacations and holidays, real wages become high, on the other hand real wages fall when such facilities are not given. For example teacher enjoys number of days as vacations and holidays. So in this sense real wages have become high.

When there are more facilities of the promotion of workers real wages tend to increase and vice versa. Real wage depend on the nature of work, term and security of service. When nature of work is favorable and there is security of services, real wages increase and vice versa.