4.1.6.2 Influences on supply of labour

Question 1

The supply curve for labour shows…

Answer 1

the relationship between the wage rate and number of workers willing and able to work in a particular occupation.

Question 2

Determinants of supply of labour

Answer 2

Wage rates - as wages are reward for labour, higher wages = extension along supply curve for labour

Size of working population = if number increases, potential supply of labour rises

Non-monetary factors = include relative satisfaction, job status, promotion prospects, job security, working condition and holiday allowance

Question 3

Define elasticity of supply of labour

Answer 3

Measure of the responsiveness of the quantity of labour supplied following a change in the wage rate.

Question 4

Formula for the elasticity of supply of labour

Answer 4

% change in Q of labour supplied / % change in wage rate

Question 5

Determinants of elasticity of supply of labour

Answer 5

Time - longer the time period, the more elastic the supply of labour - workers more able to switch occupations

Length of training period - jobs requiring long training period/significant experience will tend to have inelastic supply

Vocation - in some occupations - workers often attracted to the profession by a sense of vocation, and opportunity to ‘make a different’ to people’s lives - supply of labour relatively inelastic in these occupations

Question 6

The supply of labour to a particular occupation is influenced by both…

Answer 6

monetary and non-monetary considerations.