Theory of Wages Subsistence Theory Disadvantages (i) It is incorrect to say that when the money income of a person increases

above the subsistence level, he marries early and the birth rate increases. On the other hand, the fact is that when the income increases, it is generally followed by a higher standard of living and the workers do not produce more children. (ii) The theory fails to explain the wage differences in different employments. According to the theory, the wage rate tends to be equal to the subsistence level of all the workers. So then, how is it that wages differ from occupation to occupation and from person to person The theory has nothing to say in defense of this criticism.