3.5 - Labour Markets Flashcards

1
Q

What is derived demand?

A

When demand for a good that results in demand for a factor of production
(e.g. demand for coffee leads to demand for baristas)

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2
Q

What are the 6 factors influencing demand for labour?

A
  • Demand for the product (derived)
  • Regulation
  • Technology
  • Wages in other countries
  • Wage rates
  • prices of other factors of production
    (DR TWWP)
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3
Q

What is price elasticity of demand for labour?

A

Responsiveness of the quantity of labour demanded to the wage rate

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4
Q

What are the 4 factors affecting PED of labour?

A
  • Direct correlation to price elasticity of demand for the product
  • Proportion of wages to the total cost of production
  • Substitutes
  • Time
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5
Q

What are the 7 factors influencing supply of labour?

A
  • Wages
  • Population and distribution of age
  • Non-monetary benefits
  • Education/ training
  • Trade unions and barriers to entry
  • Wages and conditions of other jobs
  • Legislation
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6
Q

What is occupational immobility?

A

Workers find it hard to move to another job due to lack of transferable skills

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7
Q

What is geographical immobility?

A

Workers find it hard to move between regions due to costs, family etc…

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8
Q

What is elasticity of supply for labour?

A

Responsiveness of supply of labour to change in wage rates

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9
Q

What is a bilateral monopoly?

A

When there is both a monopoly and monopsony in the labour market

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10
Q

What are the 7 issues in a labour market?

A
  • Skill shortages
  • Young Workers
  • Retirement
  • Wage inequality
  • Zero-hour Contracts
  • The ‘gig economy’
  • Migration
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11
Q

What is national minimum wage?

A

Minimum hourly rate of pay and employer can pay its workers

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12
Q

What are the 5 ways the government can improve geographical mobility of labour?

A
  • Increase Supply of houses
  • Improve transport links
  • National Advertising
  • Introduce subsidies (e.g. for houses in areas of labour shortages)
  • Move public Agencies out of London
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13
Q

What are 4 ways the government can improve occupational mobility of labour?

A
  • Increase vocational training
  • Encourage further study (e.g. university)
  • Encourage greater spending on training within work
  • Helping improve interview skills
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