Exam 4: Labor Demand Elasticities

Empirical estimates of the short-run employment effects of minimum wage increases

Other things equal,an elastic demand for an industry's output will tend to make the industry's own-wage elasticity of demand

The introduction of new forms of capital generally

Employment often increases after an increase in the minimum wage because

If the quantity of auto workers demanded decreases from 66,000 to 54,000 when the equilibrium wage increases from $12.00 per hour to $14.00 per hour,then the own-wage elasticity of demand for these workers is

The minimum wage is a relatively ineffective means by which to reduce poverty.Agree or disagree.Explain your reasoning.

In an industry,when the price of electricity goes up,the company employs more low-skilled workers.This implies

If Industry A can substitute capital for labor easily and Industry B cannot,then (other things equal)

How is the own-wage elasticity of labor demand for unskilled workers affected by the elasticity of supply of other factors of production (such as skilled labor and capital equipment)? Explain.

In most states,there is a mandatory maximum number of children allowed per day care worker.If this maximum number is binding,then,if the wage of day care workers goes up,the main effect on day care employment will be

The own-wage elasticity of labor demand tends to decrease in absolute value as worker skill level increases.Agree or disagree,using the Hicks-Marshall Laws of Derived Demand to explain.

If the labor market is competitive and coverage is complete,then legislation to enact a minimum wage above the equilibrium wage level would

If the absolute elasticity of labor demand is 2.0,then an eight percent increase in the wage will

When the minimum wage increased 10 percent,the demand for skilled workers increased by 3 percent.What cross-wage elasticity would you calculate here? Explain.Is the cross-wage elasticity indicative of input categories that are gross substitutes or gross complements? Explain.

Industry A has own-wage elasticity of labor demand of -2.5.Industry B has own-wage elasticity of labor demand of -0.5.Which industry is more likely to be unionized? Explain why.

Whether or not the cross-wage elasticity of demand between two inputs is positive or negative depends on the degree of substitutability between the two inputs.Agree or disagree.Explain your reasoning.

Which of the following factors would allow a union to raise wages while losing fewer jobs?

A city mandates that all businesses who sell goods and services to the city must pay at least a living wage to their workers that is substantially above what low-skilled workers are currently being paid.Which of the following will result in a greater decrease in employment of low-skilled workers who were working for the affected businesses?

If labor is a small percentage of the total costs of an industry,this will tend to make the own-wage elasticity of labor demand

Suppose that a 5% increase in carpenters' wages causes a 1% drop in demand for plumbers.What is the cross-wage elasticity of demand for plumbers with respect to the wage of carpenters? Based on your calculation,are plumbers and carpenters gross substitutes or gross complements? Briefly explain.