Question 1

The efficient contract model implies that

Accepted Answer

A)  the union and the employer are both better off than they would be in a monopoly union model. 
B)  the union maximizes a utility function, subject to the firm's labor demand function. 
C)  the union negotiates only on wage levels, not on employment levels. 
D)  firms have more negotiating power than unions. 
A)  the union and the employer are both better off than they would be in a monopoly union model. 
B)  the union maximizes a utility function, subject to the firm's labor demand function. 
C)  the union negotiates only on wage levels, not on employment levels. 
D)  firms have more negotiating power than unions.

Question 2

Empirical studies have concluded that unionization ________ productivity and ________ profit rates.

Accepted Answer

A)  has no consistent effect on; has no consistent effect on 
B)  has no consistent effect on; reduces 
C)  reduces; has no consistent effect on 
D)  reduces; reduces 
A)  has no consistent effect on; has no consistent effect on 
B)  has no consistent effect on; reduces 
C)  reduces; has no consistent effect on 
D)  reduces; reduces

Question 3

What is the union relative wage advantage? What is the estimated value of the union relative wage advantage?

Accepted Answer

The union relative wage advantage is the

Question 4

The union resistance curve would shift inward due to

Accepted Answer

A)  the hardening of workers' attitudes after a strike begins. 
B)  an outward shift in the employer resistance curve. 
C)  a rise in the unemployment rate. 
D)  the ability of members to collect unemployment insurance benefits during a strike. 
A)  the hardening of workers' attitudes after a strike begins. 
B)  an outward shift in the employer resistance curve. 
C)  a rise in the unemployment rate. 
D)  the ability of members to collect unemployment insurance benefits during a strike.

Question 5

Suppose all textile workers in the United States formed a union.Which of the following will make it more likely the union will ask for a larger wage increase (assuming the union cares about both higher wages and retaining jobs)?

Accepted Answer

A)  Labor costs represent a large share of textile production costs. 
B)  Textile firms will not invest in capital substituting for labor in producing textiles because textiles is a declining industry. 
C)  Labor is a good substitute for capital. 
D)  Textile buyers consider U.S. textiles a good substitute for non-U.S. made textiles. 
A)  Labor costs represent a large share of textile production costs. 
B)  Textile firms will not invest in capital substituting for labor in producing textiles because textiles is a declining industry. 
C)  Labor is a good substitute for capital. 
D)  Textile buyers consider U.S. textiles a good substitute for non-U.S. made textiles.

Question 6

Strikes are more likely and of longer duration in periods of relative prosperity.Use the Hicks Bargaining Model to account for this empirical observation.

Accepted Answer

Student should draw a graph like Figure

Question 7

What has happened to the percentage of union membership in the private sector since the 1970s? What are the demand-side factors that would account for the trend you identified? What are the supply-side factors accounting for the trend you identified?

Accepted Answer

The percent of private sector workers th

Question 8

In the asymmetric-information model of strike activity,employers who provide better information about their profitability to their employees

Accepted Answer

A)  should see a decrease in frequency of strikes, but an increase in duration. 
B)  should see an increase in frequency of strikes, but a decrease in duration. 
C)  should see an increase in both frequency and duration of strikes. 
D)  should see a decrease in both frequency and duration of strikes. 
A)  should see a decrease in frequency of strikes, but an increase in duration. 
B)  should see an increase in frequency of strikes, but a decrease in duration. 
C)  should see an increase in both frequency and duration of strikes. 
D)  should see a decrease in both frequency and duration of strikes.

Question 9

Unions tend to

Accepted Answer

A)  increase wages for white-collar and blue-collar members by roughly the same amount relative to non-union workers. 
B)  increase relative wages more for blue-collar workers. 
C)  increase relative wages more for white-collar workers. 
D)  encourage high levels of education and training for their members. 
A)  increase wages for white-collar and blue-collar members by roughly the same amount relative to non-union workers. 
B)  increase relative wages more for blue-collar workers. 
C)  increase relative wages more for white-collar workers. 
D)  encourage high levels of education and training for their members.

Question 10

Increases in the minimum wage can help unions by

Accepted Answer

A)  increasing the welfare of non-union workers. 
B)  increasing the demand for labor. 
C)  increasing costs faced by employers. 
D)  increasing the cost of substituting non-union labor for union labor. 
A)  increasing the welfare of non-union workers. 
B)  increasing the demand for labor. 
C)  increasing costs faced by employers. 
D)  increasing the cost of substituting non-union labor for union labor.

Question 11

If one sector of the economy becomes unionized and there is a spillover effect then

Accepted Answer

A)  wages will increase in both sectors. 
B)  wages will increase in the unionized sector, but may either increase or decrease in the non-union sector. 
C)  wages will stay unchanged in both sectors. 
D)  wages will increase in the unionized sector, but decrease in the non-unionized sector. 
A)  wages will increase in both sectors. 
B)  wages will increase in the unionized sector, but may either increase or decrease in the non-union sector. 
C)  wages will stay unchanged in both sectors. 
D)  wages will increase in the unionized sector, but decrease in the non-unionized sector.

Question 12

If both parties become more risk averse,then the contract zone will

Accepted Answer

A)  increase in size. 
B)  decrease in size. 
C)  not change in size. 
D)  move to the right along the horizontal axis. 
A)  increase in size. 
B)  decrease in size. 
C)  not change in size. 
D)  move to the right along the horizontal axis.

Question 13

Wait unemployment

Accepted Answer

A)  occurs when union workers strike for wage increases. 
B)  will increase the size of the spillover effect. 
C)  occurs when workers choose unemployment over non-union jobs. 
D)  will cause the supply of labor to shift further to the right in the non-union sector. 
A)  occurs when union workers strike for wage increases. 
B)  will increase the size of the spillover effect. 
C)  occurs when workers choose unemployment over non-union jobs. 
D)  will cause the supply of labor to shift further to the right in the non-union sector.

Question 14

If both parties are risk neutral,then

Accepted Answer

A)  there will be a larger number of possible voluntary agreements that the parties may reach. 
B)  the parties each prefer a certain outcome to an uncertain outcome, if the expected gains are equal. 
C)  the contract zone will reach its minimal size. 
D)  their utility functions will be concave. 
A)  there will be a larger number of possible voluntary agreements that the parties may reach. 
B)  the parties each prefer a certain outcome to an uncertain outcome, if the expected gains are equal. 
C)  the contract zone will reach its minimal size. 
D)  their utility functions will be concave.

Question 15

Many unions have favored import quotas and tariffs because

Accepted Answer

A)  they want to shift demand towards the goods they produce. 
B)  they are trying to increase the welfare of all Americans. 
C)  they want their employers to substitute labor for capital and other inputs. 
D)  All of the above. 
A)  they want to shift demand towards the goods they produce. 
B)  they are trying to increase the welfare of all Americans. 
C)  they want their employers to substitute labor for capital and other inputs. 
D)  All of the above.

Question 16

Which of the following best describes the economic nature of a union?

Accepted Answer

A)  a monopoly 
B)  a monopsonist 
C)  a producer of public goods 
D)  an agency assuring workers get a wage reflecting their supply price of labor. 
A)  a monopoly 
B)  a monopsonist 
C)  a producer of public goods 
D)  an agency assuring workers get a wage reflecting their supply price of labor.

Question 17

Estimating the effect of unions on wages is difficult because

Accepted Answer

A)  data on wages in union and non-union jobs are scarce. 
B)  relative wage effects are often indeterminate. 
C)  there is no way to estimate what wages would be if unions did not exist. 
D)  unions have no effect on the non-union segment of the labor market. 
A)  data on wages in union and non-union jobs are scarce. 
B)  relative wage effects are often indeterminate. 
C)  there is no way to estimate what wages would be if unions did not exist. 
D)  unions have no effect on the non-union segment of the labor market.

Question 18

A vertical contract curve implies that

Accepted Answer

A)  both firm and workers are receiving economic rents. 
B)  union wage increases will cause large losses in employment. 
C)  the firm's output will increase when wages rise. 
D)  the firm operates in a perfectly competitive product market. 
A)  both firm and workers are receiving economic rents. 
B)  union wage increases will cause large losses in employment. 
C)  the firm's output will increase when wages rise. 
D)  the firm operates in a perfectly competitive product market.

Question 19

Which of these probably has played the LEAST important role in the drop in unionization rates in the United States over the past 20 years?

Accepted Answer

A)  the increase in the share of employment by female workers 
B)  the increase in the share of employment in sunbelt states 
C)  resistance to unionization by employers 
D)  increased competitive pressures within product markets 
A)  the increase in the share of employment by female workers 
B)  the increase in the share of employment in sunbelt states 
C)  resistance to unionization by employers 
D)  increased competitive pressures within product markets

Question 20

Union membership in the United States is currently ________ other industrialized countries.

Accepted Answer

A)  lower than in 
B)  higher than in 
C)  similar to that in 
D)  around the median of 
A)  lower than in 
B)  higher than in 
C)  similar to that in 
D)  around the median of

The efficient contract model implies that

Empirical studies have concluded that unionization productivity and profit rates.

What is the union relative wage advantage? What is the estimated value of the union relative wage advantage?

The union resistance curve would shift inward due to

Suppose all textile workers in the United States formed a union.Which of the following will make it more likely the union will ask for a larger wage increase (assuming the union cares about both higher wages and retaining jobs)?

Strikes are more likely and of longer duration in periods of relative prosperity.Use the Hicks Bargaining Model to account for this empirical observation.

What has happened to the percentage of union membership in the private sector since the 1970s? What are the demand-side factors that would account for the trend you identified? What are the supply-side factors accounting for the trend you identified?

In the asymmetric-information model of strike activity,employers who provide better information about their profitability to their employees

Unions tend to

Increases in the minimum wage can help unions by

If one sector of the economy becomes unionized and there is a spillover effect then

If both parties become more risk averse,then the contract zone will

Wait unemployment

If both parties are risk neutral,then

Many unions have favored import quotas and tariffs because

Which of the following best describes the economic nature of a union?

Estimating the effect of unions on wages is difficult because

A vertical contract curve implies that

Which of these probably has played the LEAST important role in the drop in unionization rates in the United States over the past 20 years?

Union membership in the United States is currently ________ other industrialized countries.

Introduction

Overview of the Labor Market

The Demand for Labor

Labor Demand Elasticities

Frictions in the Labor Market

Supply of Labor to the Economy: The Decision to Work

Labor Supply: Household Production, the Family, and the Life Cycle

Compensating Wage Differentials and Labor Markets

Investments in Human Capital: Education and Training

Worker Mobility: Migration, Immigration, and Turnover

Pay and Productivity: Wage Determination within the Firm

Gender,Race,and Ethnicity in the Labor Market

Unemployment

Inequality in Earnings

The Labor-Market Effects of International Trade and Production Sharing

Filters

Exam 13: Unions and the Labor Market

The efficient contract model implies that

Empirical studies have concluded that unionization ________ productivity and ________ profit rates.

What is the union relative wage advantage? What is the estimated value of the union relative wage advantage?

The union resistance curve would shift inward due to

Suppose all textile workers in the United States formed a union.Which of the following will make it more likely the union will ask for a larger wage increase (assuming the union cares about both higher wages and retaining jobs)?

Strikes are more likely and of longer duration in periods of relative prosperity.Use the Hicks Bargaining Model to account for this empirical observation.

What has happened to the percentage of union membership in the private sector since the 1970s? What are the demand-side factors that would account for the trend you identified? What are the supply-side factors accounting for the trend you identified?

In the asymmetric-information model of strike activity,employers who provide better information about their profitability to their employees

Unions tend to

Increases in the minimum wage can help unions by

If one sector of the economy becomes unionized and there is a spillover effect then

If both parties become more risk averse,then the contract zone will

Wait unemployment

If both parties are risk neutral,then

Many unions have favored import quotas and tariffs because

Which of the following best describes the economic nature of a union?

Estimating the effect of unions on wages is difficult because

A vertical contract curve implies that

Which of these probably has played the LEAST important role in the drop in unionization rates in the United States over the past 20 years?

Union membership in the United States is currently ________ other industrialized countries.

Introduction

Overview of the Labor Market

The Demand for Labor

Labor Demand Elasticities

Frictions in the Labor Market

Supply of Labor to the Economy: The Decision to Work

Labor Supply: Household Production, the Family, and the Life Cycle

Compensating Wage Differentials and Labor Markets

Investments in Human Capital: Education and Training

Worker Mobility: Migration, Immigration, and Turnover

Pay and Productivity: Wage Determination within the Firm

Gender,Race,and Ethnicity in the Labor Market

Unemployment

Inequality in Earnings

The Labor-Market Effects of International Trade and Production Sharing

Filters

Empirical studies have concluded that unionization productivity and profit rates.