Applying Economic Model ‘Efficiency Wage’ Concept for Pharmacists

Abstract

Professional articles regarding managerial means to address pharmacist turnover generally focus on policy and psychological dimensions in lieu of relative cost analysis. We present a cost–benefit argument, based on ‘efficiency wage theory’ from the economics literature to reduce the rate of pharmacist turnover in retail establishments and hospitals. Drawing from national pharmacist data, we discuss the rationale for how much management could enhance pharmacist salaries in an organization to cost effectively reduce the turnover rate. We suggest using the approach as an adjunct to existing managerial policies aimed at reducing pharmacist turnover.