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ECON303: Labor Economics

  • Unit 4: Labor Market Equilibrium  

    In order to complete the demand-supply framework of the labor market, we will now determine the model’s equilibrium levels.  This unit will focus on how the market clearing wage is generated in competitive and non-competitive market structures.  The equilibrium wage rate and the efficiency of competitive labor markets play important roles in determining appropriate public policies.  The most common policy methods that the government uses are taxes and subsidies; through their adoption, the government can shift the labor market to a new equilibrium.  This issue will be explored in the "Policy Implications" topic under this unit.

    Unit 4 Time Advisory

    This unit should take you 7 hours to complete.

    ☐    Subunit 4.1-4.2: 1 hour

    ☐    Assessment: 3 hours

    ☐    Subunit 4.3: 2 hours

    ☐    Embedded Assessments: 1 hour (30 minutes per quiz)

    Unit4 Learning Outcomes

    Upon successful completion of this unit, students will be able to:

    • Examine the determination of the equilibrium level of employment under a variety of market structures.
    • Reading: New York University: Professor Matthew Wiswall’s “Lecture Notes on Labor Economics

      Link: New York University: Professor Matthew Wiswall's “Lecture Notes on Labor Economics” (PDF)
       
      Instructions:  Please click on “Lecture Notes” to access the pdf file with the lecture notes.  Scroll down to page 49, section 5 ("Equilibrium and Market Structure") and read the section in entirety (all the way up to page 57).  This reading covers subunits 4.1-4.2.
       
      Terms of Use: Please respect the copyright and terms of use displayed on the web pages above.

  • 4.1 Competitive Labor Markets  

  • 4.1.1 Single Competitive Labor Market  

  • 4.1.2 Equilibrium Across Labor Markets  

  • 4.2 Non Competitive Labor Markets  

  • 4.2.1 Monopsony  

  • 4.2.2 Monopoly  

    • Assessment: University of Wisconsin: Professor John Kennan's “Assignments for Labor Economics Course”

      Link: Assessment: University of Wisconsin: Professor John Kennan's “Assignments for Labor Economics Course” (HTML)
       
      Instructions:  Please click on Assignment 2 to answer the first three questions based on labor markets.  Click on “Answer Notes” to compare your results with the answers given.
       
      Terms of Use: Please respect the copyright and terms of use displayed on the web pages above.

  • 4.3 Policy Implications: Payroll Taxes  

    • Reading: McGraw Hill Higher Education: Online Learning Center: Dwayne Benjamin, Morley Gunderson, and Craig Riddell's Labor Market Economics, 5th edition: Student Centre: “Chapter Notes: Chapter 7: Wages and Employment in a Single Labour Market”

      Link: McGraw Hill Higher Education: Online Learning Center: Dwayne Benjamin, Morley Gunderson, and Craig Riddell's Labor Market Economics, 5th edition: Student Centre: Chapter Notes: Chapter 7: Wages and Employment in a Single Labour Market” (HTML)
       
      Instructions:  Please click on the above link and work through the notes to review the concepts learned in this unit and to examine the effects that payroll taxes have on the labor market.
       
      Terms of Use: Please respect the copyright and terms of use displayed on the web pages above.

    • Assessment: Lancaster University Management School: Professor Geraint Johnes' “Interactive Quizzes in Labor Economics: Basic Principles”

      Link: Lancaster University Management School: Professor Geraint Johnes' “Interactive Quizzes in Labor Economics: Basic Principles” (HTML)
       
      Instructions:  Please click on the topic "Labour Economics-Basic Principles" to access the interactive quiz for this unit and assess yourself by checking the answers provided by the author.
       
      Terms of Use: Please respect the copyright and terms of use displayed on the web pages above.

    • Assessment: Lancaster University Management School: Professor Geraint Johnes' “Interactive Quizzes in Labor Economics: Minimum Wage”

      Link: Lancaster University Management School: Professor Geraint Johnes' “Interactive Quizzes in Labor Economics: Minimum Wage” (HTML)
       
      Instructions:  Please click on the topic "Minimum Wage" to access the interactive quiz for this unit and assess yourself by checking the answers provided by the author.
       
      Terms of Use: Please respect the copyright and terms of use displayed on the web pages above.