Labour Market Shifts Flashcards
1
Q
What are the 7 main reasons for shifts in labour supply and demand?
A
derived demand
productivity
capital costs
migration
income tax and benefits
non-pecuniary benefits
education and training
2
Q
Productivity
A
demand for workers increases if their productivity increases - more profit for firms
EVAL
could decrease demand - need fewer workers for same amount
3
Q
Capital costs
A
capital and labour are substitutes
if price of capital decreases, demand for labour decreases
4
Q
Benefits
A
decrease benefits - people forced into work force - increase labour supply
5
Q
Income tax
A
high income tax - reduced incentive - decrease supply
however some people need to pay for high mortgages and will need to work harder to maintain money, increasing supply
