Karteikarten
Labour market
Karten in diesem Stapel (14)
- 1What type of market is a labour market and what does it contribute?It is a type of factor market from which employers find the labour they require whilst millions of people offer their labour services in different jobs
- 2What type of relationship is there between wage rate and demand for labourAn inverse relationship as higher wage means its more costly to hire extra employees
- 3What happens to labour when wage rate is low? What effect will a fall in wage create and what happens to labour demand?Labour becomes relatively cheaper than using capital inputs
A substituition effect will occur and which could lead to expansion in labour demand - 4Why does the demand curve for labour slope downwards?Slopes due to the income and substitution effect.
- 53 examples as to why demand in labour may shift Why would the curve go inwards and outwards, its consequences and what is the result from this?-A rise in consumer demand for a product means more workers need to be hired
-An increase in productivity of labour makes labour more cost efficient than using capital
-A government subsidy allows a business to employ more people
The curve goes inwards due to recession when sales of goods and services are in decline. Substitutes could also be cheaper meaning there is less demand.
It can go outwards if there is an increase in income and substitutes are expensive. Labour dedundancies and a decline in demand for labour at each wage rate is the result of this - 6What would the income effect be on rise of wages for the Labour Market? Substitution?Income= As wages rise people feel better off and therefore may not feel a need to work many hours
Sub= As wages rises, the opportunity cost for leisure rises meaning more people will turn to leisure than work - 7what is labour supply? What does the curve for labour supply look like and why?number of hours people are willing to supply at a given wage rate
Labour supply curve is upward sloping since as wages rise, more people enter the industry attracted by the incentives - 8What two most important things affects supply of labour and how?Geographical mobility of labour - people may not be willing to move or cannot find suitable housing
Occuptational mobility of labour= lack of skills and qualifications for job requirements - 9What type of jobs are elastic and inelastic and how is it on a graph?Lower skilled jobs are elastic because many people are available at a fairly constant wage rate
Jobs requiring specific skills and training will have a more inelastic labour supply - 10What may cause an increase and decrease in Supply? What happens to equilibrium when wage is increased and decreased?Less supply = less migration
more supply = more migration
Increased = excess supply and downward pressure on the equilibrium
Decreased = excess demand and upward pressure on the equilibrium - 11PED of labour is affected by? and how?-Affected by substitutability of labour. Demand is more elastic where workers can easily be replaced by capital etc
-Labour costs would increase in percentage of the total cost
-PED for the final product = where demand is inelastic a firm can pass on higher labour costs to the customer through price increases - 12PES is affected by? and how? 3-Restrictions to entry into a job (especially long qualifications and training)
-Specifc Skill requirements
-Occupational mobility of labour (more transferrable skills can lead to a more elastic labour market) - 13How does income effect demand curves and what effect will a cut in price have? How does the substitution effect demand curves?Increase in income means consumers increase their demand
Lower income means consumers can buy more and ceteris paribus means demand will increase.
A cut in price means income will be reduced and consumers have to cut back on demand
Consumers can switch to a cheaper alternative if the original increases in price - 14Benefits of National Minimum Wage 4 Cons of National Minimum Wage 4 Unemployment in terms of elasticity-Reduces poverty
-Reduces wage differentials
-Increase in productivity
-Incentive to work
-------------------------------------------------------
- Increase in unemployment since supply is higher than demand
- Youth have trouble justifying why they need the job since they do not have enough experience (More inelastic means less chance of unemployment)
- Businesses can go out of business as they cannot afford to pay for their workers
Informationen
- Beschreibung
- AS level Economics Karteikarten am Labour market, erstellt von Dale George am 05/11/2016.
- Erstellt von
- Dale George
- Aufrufe
- 1
- Bewertung