College Microeconomics Course Chapter 12

the ___ exempted labor unions from antitrust laws

Clayton Act of 1914

the ___ serves as a national organization of unions in mass production industries in the United States

Congress of Industrial Organizations

___ encourages workers to supply more labor

the substitution effect of a wage increase

___ in the job market traces back to training, education, experience, ability, risk of job loss, and risk of injury

wage discrimination

reason why the labor supply curves bend backwards?

a higher wage reduces the work hours of individuals

___ is a union's attempt to withhold labor from a firm to halt production

a strike

difference between a mediator and an arbitrator

an arbitrator has the power to impose a binding settlement on union and management, while a mediator has no power to impose a settlement

an individual who has considerable income from savings, borrowing, support, and scholarship:

will tend to reduce the quantity of labor supplied

suppose a union is unable to resolve issues between workers and management. this adversely affects the productivity of union workers. a fall in the marginal productivity of union workers will lead to a:

fall in the demand for union workers

workers often face migration hurdles due to the strict migration policies in different countries. suppose these countries relax migration policies and there is a reduction in the migration hurdles faced by laborers. this will lead to a:

fall in wage differentials across countries

___ is an attempt to ensure that more union labor is hired than producers would prefer. for example, a musician's union may require more musicians be employed in a Broadway musical than is required.

featherbedding

a group of workers who join together to improve their terms of employment is called a:

labor union

an increase in the demand for union labor ____, everything else remaining unchanged

leads to higher wage and employment

a profit-maximizing firm hires labor up to the point where the:

marginal revenue product of labor equals its marginal resource cost

an impartial observer who helps resolve differences between union and management is known as a:

mediator

an industrial union refers to an:

organization of both skilled and unskilled workers from a particular industry

an increase in the demand for union-made goods will lead to a:

rightward shift of the demand curve for union workers

describes the right-to-work states

states where workers in unionized companies do not have to join the union or pay union dues

major source of union power

strike

suppose a labor union manages to negotiate a wage above the market-clearing level. it is likely to result in a:

surplus in the labor market

what represents the net utility of work?

the difference between the utility from additional consumption and the disutility of work

a rational consumer attempts to maximize utility by allocating his or her time so that:

the expected marginal utility of the last time spent in market work, nonmarket work, and leisure is identical

according to the theory of time allocation, other things constant, ____

the higher the market wage, the lesser the marginal utility of leisure

as the market wage increases, ____

the income effect normally influences you to work less

in the case of a backward-bending labor supply curve,____

the income effect of a higher wage offsets the substitution effect

the approach by which a labor union tries to negotiate an industry-wide wage for different classes of labor is called:

the industrial approach

work or market activity is subject to:

the law of increasing marginal disutility

describes the relationship between an individual worker's labor supply curve and the market labor supply curve

the market labor supply curve is the horizontal summation of the quantities of labor supplied by each worker in the labor market at a given wage rate

what are the three economic uses of time?

1. market work 2. nonmarket work 3. leisure

___ is a negotiation in which union and management must accept an impartial observer's resolution of a dispute

binding arbitration

way by which unions can cause an increase in wages

by forming an exclusive, or craft, union

____ is the process by which representatives from a union and from management negotiate a mutually agreeable contract specifying wages, employee benefits, and working conditions

collective bargaining

a ___ is a group whose members have a particular skill or do a specific job, such as carpenters

craft union

restricting labor supply to increase wages is typical of:

craft unions

true of leisure

it is subject to the law of diminishing marginal utility

the ____ tends to increase an individual's demand for leisure

income effect of a wage increase

unions have grown more reluctant to strike because of the:

increased willingness of employees to hire strikebreakers in recent decades

according to the economic theory of labor markets, an individual spends time in nonmarket work when the:

individual can produce goods and services more cheaply than the market can

with the help of inclusive, or industrial, approach, a union tries to negotiate:

industry-wide wages for each class of labor

in a resource market, workers are rewarded based on:

their marginal productivity

a craft union can raise union members' wages by restricting labor supply:

through high initiation fees, long apprenticeship periods, or difficult, qualifying requirements