Econ 10

According to the theory of efficiency wages, firms may find it profitable to pay above-equilibrium wages. an excess supply of labor puts downward pressure on wages. sectoral shifts are the main source of frictional unemployment. right-to-work laws reduce the bargaining power of unions.

firms may find it profitable to pay above-equilibrium wages. Efficiency wages are higher than the equilibrium wage determined by supply and demand, but nonetheless, paying efficiency wages may be profitable for some firms. Higher wages can increase productivity by increasing worker health, decreasing worker turnover, and increasing worker quality

The main policy goal of the unemployment insurance system is to reduce the search effort of the unemployed. income uncertainty that workers face. role of unions in wage setting. amount of frictional unemployment.

income uncertainty that workers face The goal of unemployment insurance is to reduce income uncertainty by providing payments to those who are laid off. An undesired side effect is a reduction in the search effort of the unemployed and, thus, an increase in the amount of frictional unemployment. By making unemployment less difficult, unemployment insurance decreases the incentive to become employed again quickly.

The population of Ectenia is 100 people: 40 work full-time, 20 work half-time but would prefer to work full-time, 10 are looking for a job, 10 would like to work but are so discouraged they have given up looking, 10 are not interested in working because they are full-time students, and 10 are retired. What is the number of unemployed? 10 20 30 40

10 The category of unemployment includes those who are not employed, are available for work, and tried to find employment during the previous four weeks. It also includes those waiting to be recalled to a job from which they were laid off. In Ectenia, the 10 who are looking for a job are the only unemployed people; discouraged workers, students, and the retired are considered "not in the labor force" and are not counted as unemployed. See Section: How Is Unemployment Measured?

Unionized workers are paid about _____ percent more than similar nonunion workers. 2 5 15 40

15 Economists who study the effects of unions typically find that union workers earn about 15 percent more than similar workers who do not belong to unions.

According to the most recent data, among workers who are paid at an hourly rate, about _____ percent have jobs that pay at or below the minimum wage. 2 5 15 40

5 Of those workers paid an hourly rate, about 4 percent of men and 6 percent of women reported wages at or below the prevailing federal minimum

The population of Ectenia is 100 people: 40 work full-time, 20 work half-time but would prefer to work full-time, 10 are looking for a job, 10 would like to work but are so discouraged they have given up looking, 10 are not interested in working because they are full-time students, and 10 are retired. What is the size of Ectenia's labor force? 50 60 70 80

70 The BLS defines the labor force as the sum of the employed and the unemployed. There are 60 employed people in this economy (full-time and part-time workers) and 10 unemployed. Therefore the size of the labor force is 70