ECO 2023

chater 17

Labor

Any type of worker, including blue-collar and white-collar.

Wages

Price paid for labor, including direct payments and benefits.

Nominal Wage

Amount of money received per time period.

Real Wage

Purchasing power of nominal wages in goods/services.

Labor Productivity

Output per hour worked, affects labor demand.

Competitive Labor Market

Market where wages and employment levels are determined.

Monopsony

Market structure where one buyer controls the labor market.

Unions

Organizations that negotiate for higher wages and benefits.

Collective Bargaining

Negotiation process between unions and employers.

Bilateral Monopoly

Market situation with one buyer and one seller.

Minimum Wage Laws

Legislation setting the lowest legal wage rate.

Wage Differentials

Variations in wages across jobs and regions.

Pay-for-Performance Plans

Compensation based on employee performance metrics.

Labor Demand Curve

Graph showing the relationship between wage and quantity of labor demanded.

Labor Supply Curve

Graph indicating the relationship between wage and quantity of labor supplied.

Market Equilibrium

Point where labor supply equals labor demand.

Marginal Revenue Product (MRP)

Additional revenue generated from hiring one more worker.

Marginal Resource Cost (MRC)

Cost of hiring one additional worker.

Craft Unions

Unions representing skilled workers in specific trades.

Industrial Unions

Unions representing all workers in an industry.

Occupational Licensing

Regulations requiring licenses to practice certain professions.

Real Hourly Compensation

Wages adjusted for inflation over time.

U.S. Union Membership

Percentage of workers belonging to unions in the U.S.

Economic Effects of Unions

Impact of unions on wages, employment, and productivity.

Wage Rates

Compensation levels that vary by occupation and region.

Labor Market

Marketplace where labor supply and demand interact.

Productivity Factors

Elements influencing labor productivity, such as technology.

Supply Curve

Upward-sloping curve representing supply of labor.

Demand Curve

Downward-sloping curve representing demand for labor.

Equilibrium Point

Intersection of supply and demand curves.

Wage Maker

Firm that sets wages based on labor supply.

Profit Maximization

Hiring until MRP equals MRC.

Quantity of Labor

Amount of labor hired by firms.

Wage Rate

Payment per unit of labor hired.

Total Labor Cost

Total expenditure on labor hired.

Horizontal Axis

Represents quantity of labor in graphs.

Vertical Axis

Represents wage rate in graphs.

Labor Market Graph

Visual representation of labor supply and demand.

Monopsonistic Labor Market

Market dominated by one employer for labor.

Competitive Wage

Wage determined in a competitive labor market.

Monopsonist's Wage

Wage set by a single buyer of labor.

Shaded Region

Area representing economic surplus in graphs.

Geographical Immobility

Limited worker movement due to location.

Skill Transferability

Ability to apply skills in different jobs.

Labor Cost Calculation

Determined by subtracting previous total from current.

Hiring Quantity in Monopsony

Less than in competitive markets due to wage.

Example of Monopsony

Nurses limited to local hospitals.

Player Drafts

Limits professional athletes' employment options.

Wc

Competitive wage rate, twenty dollars.

Qc

Quantity of labor in competitive market, one thousand.

MRC Curve

Monopsonist's marginal resource cost curve.

Labor Market Table

Data representation of labor costs and wages.

Monopsonistic Power

Power held by a single buyer in labor markets.

Demand Enhancement Model

Unions increase labor demand via goods/services demand.

Political Lobbying

Efforts to influence government policy for labor benefits.

Complementary Resource

Resource that enhances productivity of union labor.

Union Wage

Higher wage achieved through increased labor demand.

Craft Union Model

Unions restrict labor supply to raise wage rates.

Exclusive Unionism

Union membership required for specific job access.

Supply Restriction

Limiting available labor to increase wages.

Industrial Union Model

Unions organize all workers in an industry.

Wage Taker

Firm that accepts market wage without influence.

Perfectly Elastic Labor Supply

Labor supply responds instantly to wage changes.

Union Employment Impact

Unionization often reduces employment in firms.

Union Wage Premium

Union wages average 15% higher than non-union wages.

Child Labor Reduction

Legislation supported by unions to limit child workers.

Compulsory Retirement

Mandated retirement age to control labor supply.

Shorter Workweek

Union advocacy for reduced hours to limit labor supply.

Labor Demand Graph

Visual representation of labor demand changes.

Union Job Loss Debate

Discussion on unions' effectiveness in raising wages.

Graph Intersection Points

Points where supply and demand curves meet.

Union Membership Policies

Rules governing who can join a labor union.

Demand Curve Shift

Movement of demand curve indicating increased labor demand.

Wage Rate Increase

Higher wages resulting from increased labor demand.

Employment Decline Effect

Fewer jobs due to union wage demands.

Graphical Representation

Visual aids illustrating economic concepts and models.

Inclusive Unionism

Union strategy open to all workers in industry.

Employment Decline

Reduction of jobs in unionized firms due to unions.

Wage Demands

Requests for higher pay from unionized workers.

Monopsonist Labor Market

Market with one dominant employer for labor.

Indeterminate Wage Rate

Wage outcome depends on bargaining power balance.

Fair Labor Standards Act

1938 law establishing federal minimum wage standards.

Federal Minimum Wage

Current rate is $7.25 per hour (2009).

State Minimum Wage Laws

Local laws can set higher than federal minimum.

Critics of Minimum Wage

Argue it reduces employment and harms businesses.

Advocates of Minimum Wage

Support minimum wage to counter monopsonistic power.

Labor Demand

Desire for workers by employers in market.

Labor Supply

Availability of workers willing to work.

Occupational Wage Differential

Differences in pay due to labor demand variations.

Anesthesiologists Salary

Average annual wage is $271,440.

Financial Managers Salary

Average annual wage is $151,510.

Law Professors Salary

Average annual wage is $134,760.

Pharmacists Salary

Average annual wage is $125,460.

Civil Engineers Salary

Average annual wage is $95,440.

Registered Nurses Salary

Average annual wage is $80,010.

Minimum Wage Effects

Debate on employment impact and poverty alleviation.

Labor Market Graphs

Visual representations of supply and demand interactions.

Marginal Revenue Productivity

Additional revenue generated by one more worker.

Human Capital

Investments in education and training enhancing productivity.