Econ Trade Unions Week 1 & 2

Union

A collective organization of workers of a firm or occupation whose primary objective is to improtect and improve the well being of its members

Workers, Firms, Government, Unions

Who are the four playres in the labour market?

Extensive margin

Workers deciding whether to work

Intensive margin

Once workers decide to work, workers deciding how much to work

Labour supply

The relationship between the quantity of labour that workers are willing to provide over a given period and the wage rate offered by firms

Labour demand

The relationship between the quantity of labour that firms are willing to hire over a given period and the wage rate accepted by workers

Labour market outcome

A phenomenon generated from the labour market as a result of the forces of labour supply and labour demand

Wage differentials

A percentage difference between the wage rates of two comparable groups of workers

Union — Non-Union Wage Differential

The percentage difference between the wage rates of union workers and otherwise comparable non-union workers

Total income, after tax income, market income, earnings

Order Market Income, After-Tax income, Earnings, and Total income by largest to smallest

Right skewed

The wage earnings distribution in Canada is (normal distribution/right skewed)

90 10 ratio

90th percentile value / 10th percentile value

Earnings / Hours Worked

Implicit wage rate calculation
-used to find wage rate of a salaried worker

Reservation Wage

The wage rate at which a worker is indifferent between working and not working

Positive, Negative

An increase in wage rate leads to a (positive/negative) substitution effect on quantity of labour supplied and a (positive/negative) income effect on the quantity of labour supplied