Benjamin5 PPT 01
25
© 2002 McGraw-Hill Ryerso n Ltd. Chapter 1-1 Chapter One Introduction to Labour Market Economics Created by: Erica Morrill, M.Ed Fanshawe College
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Transcript of Benjamin5 PPT 01
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-1
Chapter One
Introduction to Labour Market Economics
Created by: Erica Morrill, M.Ed
Fanshawe College
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-2
Chapter FocusMain actors and rolesLabour supply and demandPolicy QuestionsCharacteristics of marketNeoclassical and alternative approaches
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-3
Labour Market ParticipantsIndividualsFirmsGovernment
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-4
Decisions by Individuals When to enter the labour force How much education/training Type/extent of job search Occupation/Industry Labour hours/household work Accept/quit/ relocation Wage rate Union/association
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-5
Labour Market Behaviour Positive Aspects
Obtaining a job Promotion Increase in wage rate
Benefits
Negative Aspects
Unemployment Job displacement
Discrimination Poverty
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-6
Decisions by Employers # of workersWages/benefitsHoursLayoff /bankruptcySubcontractPension/retirement policy
Global Competition
Legislative Environment
Changing Workforce
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-7
Global Competition InfluencesFree tradeIndustrial restructuringDeregulationPrivatization
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-8
Changing WorkforceAgeGenderEthnic diversity
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-9
Legislative Environment Human Rights Minimum wage Overtime Maternity leave Worker’s compensation Occupational health/safety Pensions/mandatory retirement Labour laws/collective bargaining
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-10
individual rights vs. employer competitiveness public support
Training Insurance Compensation Pensions Vocational rehabilitation
Decisions by Government
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-11
Labour Market Economics
Involves analyzing the determinants of the various dimensions of labour supply
and demand and their interaction in alternative
market structures to determine wages, employment and
unemployment.
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-12
Dimensions of Labour SupplyQuantity DimensionsPopulation growthLabour force participationWork hours
part-time overtimeflex-time
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-13
Dimensions of Labour SupplyQuality DimensionsHuman capital investments
education, training, healthmobility
Work effort/intensity
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-14
Dimensions of Labour SupplyIncentive effects of income maintenance and tax-transfer schemes wage subsidies income taxes insurance welfare disability pension plans
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-15
Dimensions of Labour DemandThe firm’s demand for labour are based on:labour costs firms output
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-16
Supply and DemandThe interaction between supply and demand determineswagesemploymentunemployment
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-17
Table 1.1 Sources of Income for Individual Canadians, 1994
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-18
Figure 1.1 The Distribution of Individual Labour Earnings, 1994
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-19
Figure 1.2 The Distribution of Individual Annual Hours Worked, 1994
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-20
The Supply and Demand ModelKey assumptions in the neoclassical model:behavioural assumptions
how buyers and sellers respond to prices and other factors
interaction of buyers and sellers and level and terms of market exchange
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-21
Figure 1.4 Wages and Employment in a Competitive Labour Market
NS
Employment
Wages
ND
W*
N*
W’
ND’ NS’
Supply >Demand
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-22
Current Policy IssuesConcerns for both public and private policymakers
Supply DemandWage determination and wage structure
Unemployment
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-23
Similarities/Differences Between Labour Market and Other Markets Various actors/goals
three with different objectives or agendas Sociological, institutional and legislative constraints
Market imperfections imperfect/asymmetric information costs uncertainty and risk
Complex price serving a variety of functions wage reflects a variety of factors
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-24
Alternative PerspectivesNeoclassicalInstitutionalismDualismRadicalism
© 2002 McGraw-Hill Ryerson Ltd.
Chapter 1-25
End of Chapter One
