LABOR ECONOMICS
8th Edition
ISBN: 9781260004724
Author: BORJAS
Publisher: RENT MCG
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Chapter 7, Problem 5P
To determine
Nations face a compression in the wage distribution and the nations that experienced the greatest percent of wage dispersion.
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Analyze and elaborate the factors that lead to wage differentials between two different regions of a country.
Suppose male wages are determined by the earnings function WM = 25 + 0.40EM and female wages are determined by the earnings function WF = 15 + 0.20EF. If women have 10 years of experience and men have 20, what is the gender wage gap? How much can be attributed to human capital differences and how much is unexplained, and therefore attributed to discrimination? Show this scenario on a graph of both the male and female earnings functions
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There are innate differences between men and women that make men more productive than women. Because…
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- Describe how the earnings gap between men and women has evolved in recent decades.arrow_forwarddiscuss how that relationship between the elasticity of demand for products and labor would affect your job searching strategy in the future.arrow_forwardWhat are the effects of emigration on employment, wages, and social welfare if labor supply is not perfectly inelastic. How do the effects differ from where there is a perfectly inelastic labor supply?arrow_forward
- Describe how the earnings gap between blacks and whites has evolved in recent decades.arrow_forwardIn general, different jobs pay different wages. One overarching reason is that different jobs have different characteristics, with wages serving to compensate for those different characteristics. Consider two virtually identical individuals, employed in the same industry and working in the same region. One of the individuals works in Occupation A, while the other works in Occupation B. Assume that the individual working in Occupation A earns a higher wage than the individual working in Occupation B. Describe four differences between Occupations A and B that could each help explain the different wages paid to the two workers.arrow_forwardList the six factors that can explain a variance in earnings. Select ONE factor and list two reasons why this you believe this factor has the most influence in wage differences. Why is the price elasticity of supply different for low mobility workers and high mobility workers? In proving that there are earnings differentials caused by discrimination, what three factors are necessary in a study conducted to prove this point?arrow_forward
- 1. Computing labor productivity and its relationship to the demandfor labor Sizzler's produces charcoal grills in a small manufacturing facility and sells the grills in a competitive market. The following table presents the company's production function: Labor (Number of workers) 0 OUTPUT (Grills) 400 360 320 280 Use the blue points (circle symbol) to plot the production function for Sizzler's on the following graph. 240 200 160 120 80 40 0 1 0 2 3 4 5 1 Output (Grills) 0 95 185 260 320 355 2 3 LABOR (Number of workers) 4 5 Production Function (?) Calculate the marginal product of labor (MPL) of each worker, and then plot the MPL curve on the following graph using the blue points (circle symbol).arrow_forwardRefer to the graph shown. Which of the following wage rates would be an effective price floor? Wage per hour $7.25 $6.50 $4.50 $6.50 $3.50 $4.50 $7.25 So 500 800 900 1200 Do Number of workersarrow_forwardIf the price elasticity of demand for labor is 0.2 and the wage increased from $11 to $16 an hour, what is the predicted decrease in the level of employment in percentage terms?arrow_forward
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