By: Alejandro

@Hemal: One reason firms may keep wages a secret is because they can then perform wage discrimination and earn more money. If Alice and Bob are equally productive but Bob is willing to work for $5,000 less than Alice, then the firm can make more money by paying Bob less. However, this will only work if Bob doesn’t know both Alice’s salary and his productivity relative to Alice.
Look up “price discrimination” for more information.