Flashcards
labour markets
Cards in this deck (11)
- 1what factors influence demand for labour?when workers become more productive, output is more efficient, firms will be prepared to pay more.
the cost of capital. if firms find that capital is cheaper, and more efficient, that would favour capital
the percentage of labour costs in relation to the total costs, the greater the percentage, the more elastic.
marginal revenue product - 2what is the idea of labour being derived demand?derived demand means that the demand for labour is dependant on the demand for the final goods and services that the workers produce
- 3what is demand for labour? what is supply of labour?the demand for labour is the amount that firms are willing to pay for a certain amount of time
supply of labour is the number of workers willing and able to work within any given time - 4what factors influence supply of labour?the quality of education and training
migration
income tax
strength of trade unions
the opportunity cost of leisure - 5imperfections in the labour marketimperfect knowledge- workers wont know what jobs are available
geographical immobility- the idea that people have difficulty moving from job to job due to difficulty in relocating. costs, friends and family etc
rationale
occupational immobility- people cant change job due to inadequate skills or knowledge of job existing - 6what are the current labour market issuesskill shortages in certain areas, such as maths teachers in inner cities
unemployment
underemployment- workers in jobs that don't require their acquired skill and don't fulfil productive potential
tax credits- can either be an incentive or deterrant for working - 7benefits of minimum and maximum wage?minimum wages can shorten inequality gap and reduce poverty
incentivise people to work
maximum wages are seen as a way to prevent the top 1% of earners creaming off the profits - 8costs of minimum and maximum wage?minimum wages can cause excess supply in a price elastic demand for labour if too high above equilibrium wage
minimum wages need to reflect living standard in the city
maximum wages can deter certain workers from staying in the workforce in the country - 9other ways government intervenelegislation: redundancy pay and notice
protection from unfair mistreatment
employers are obliged to protect staff under a health and safety act.
relocation subsidies and training programs - 10what influences PED for labourthe proportion of wages to the total costs. the greater the proportion, the greater the impact of wage increase. more elastic
the time, in short run its more inelastic as its harder to replace labour with capital. over time it grows more elastic
PED of actual product. if wages increase and PED is elastic, it will effect demand so PED for wages will be elastic - 11P.E.supply of labour is dependant on?how skilled the workforce is, the more skilled and specialised, the less supply will fluctuate with wages.
low skilled labour is more price elastic. the more likely supply will change with wages
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- A level Economics (Micro Economics 3) Flashcards on labour markets, created by Daniel Nnajiuba on 02/10/2020.
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- Daniel Nnajiuba
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