Economists Mark Blaug and Ruth Towse studied the market for economists in Britain and found that the quantity demanded was about 150 to 200 a year, and that the quantity supplied was about 300 a year. What likely to happen when there is a surplus of economists in Britain? Economists will form a strong labor union in order to maintain high wages for themselves. They will also push for stronger comparable worth laws. The elasticity of labor supply will rise for economists because the quantity of labor supplied will increase by a greater percentage than the wage. When there is an elastic supply of labor, wages tend to fall in the long run. Economists will immigrate to countries with an excess supply of economists. This is an example of the incentive effect. Some economists will leave this labor market and either start their own business or accept jobs in other markets or in other countries. This would mitigate the decline in economists' wages
Economists Mark Blaug and Ruth Towse studied the market for economists in Britain and found that the quantity demanded was about 150 to 200 a year, and that the quantity supplied was about 300 a year. What likely to happen when there is a surplus of economists in Britain? Economists will form a strong labor union in order to maintain high wages for themselves. They will also push for stronger comparable worth laws. The elasticity of labor supply will rise for economists because the quantity of labor supplied will increase by a greater percentage than the wage. When there is an elastic supply of labor, wages tend to fall in the long run. Economists will immigrate to countries with an excess supply of economists. This is an example of the incentive effect. Some economists will leave this labor market and either start their own business or accept jobs in other markets or in other countries. This would mitigate the decline in economists' wages
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter4: Labor And Financial Markets
Section: Chapter Questions
Problem 32P: Imagine that to preserve the traditional way of life in small fishing villages, at government...
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