Bài giảng Labour Market Economics - Chapter 1 Introduction to Labour Market Economics

Chapter One Introduction to Labour Market Economics Created by: Erica Morrill, M.Ed Fanshawe College1© 2002 McGraw-Hill Ryerson Ltd.Chapter FocusMain actors and rolesLabour supply and demandPolicy QuestionsCharacteristics of marketNeoclassical and alternative approaches2© 2002 McGraw-Hill Ryerson Ltd.Labour Market ParticipantsIndividualsFirmsGovernment3© 2002 McGraw-Hill Ryerson Ltd.Decisions by IndividualsWhen to enter the labour forceHow much education/trainingType/extent of job searchOccupation/IndustryLabour hours/household workAccept/quit/ relocationWage rateUnion/association4© 2002 McGraw-Hill Ryerson Ltd.Labour Market Behaviour Positive Aspects Obtaining a jobPromotionIncrease in wage rateBenefitsNegative AspectsUnemploymentJob displacementDiscriminationPoverty5© 2002 McGraw-Hill Ryerson Ltd.Decisions by Employers # of workersWages/benefitsHoursLayoff /bankruptcySubcontractPension/retirement policyGlobal CompetitionLegislative EnvironmentChanging Workforce6© 2002 McGraw-Hill Ryerson Ltd.Global Competition InfluencesFree tradeIndustrial restructuringDeregulationPrivatization7© 2002 McGraw-Hill Ryerson Ltd.Changing WorkforceAgeGenderEthnic diversity8© 2002 McGraw-Hill Ryerson Ltd.Legislative EnvironmentHuman RightsMinimum wageOvertimeMaternity leaveWorker’s compensationOccupational health/safetyPensions/mandatory retirementLabour laws/collective bargaining9© 2002 McGraw-Hill Ryerson Ltd.individual rights vs. employer competitivenesspublic supportTrainingInsuranceCompensationPensionsVocational rehabilitationDecisions by Government10© 2002 McGraw-Hill Ryerson Ltd.Labour Market EconomicsInvolves analyzing the determinants of the various dimensions of labour supply and demand and their interaction in alternative market structures to determine wages, employment and unemployment.11© 2002 McGraw-Hill Ryerson Ltd.Dimensions of Labour SupplyQuantity DimensionsPopulation growthLabour force participationWork hours part-time overtimeflex-time 12© 2002 McGraw-Hill Ryerson Ltd.Dimensions of Labour SupplyQuality DimensionsHuman capital investmentseducation, training, healthmobilityWork effort/intensity13© 2002 McGraw-Hill Ryerson Ltd.Dimensions of Labour SupplyIncentive effects of income maintenance and tax-transfer schemeswage subsidiesincome taxesinsurancewelfaredisabilitypension plans14© 2002 McGraw-Hill Ryerson Ltd.Dimensions of Labour DemandThe firm’s demand for labour are based on:labour costs firms output15© 2002 McGraw-Hill Ryerson Ltd.Supply and DemandThe interaction between supply and demand determineswagesemploymentunemployment16© 2002 McGraw-Hill Ryerson Ltd.Table 1.1 Sources of Income for Individual Canadians, 199417© 2002 McGraw-Hill Ryerson Ltd.Figure 1.1 The Distribution of Individual Labour Earnings, 199418© 2002 McGraw-Hill Ryerson Ltd.Figure 1.2 The Distribution of Individual Annual Hours Worked, 199419© 2002 McGraw-Hill Ryerson Ltd.The Supply and Demand ModelKey assumptions in the neoclassical model:behavioural assumptions how buyers and sellers respond to prices and other factorsinteraction of buyers and sellers and level and terms of market exchange20© 2002 McGraw-Hill Ryerson Ltd.Figure 1.4 Wages and Employment in a Competitive Labour MarketNSEmploymentWagesNDW*N*W’ND’NS’Supply >Demand21© 2002 McGraw-Hill Ryerson Ltd.Current Policy IssuesConcerns for both public and private policymakersSupply DemandWage determination and wage structure Unemployment22© 2002 McGraw-Hill Ryerson Ltd.Similarities/Differences Between Labour Market and Other MarketsVarious actors/goalsthree with different objectives or agendasSociological, institutional and legislative constraintsMarket imperfectionsimperfect/asymmetric informationcostsuncertainty and riskComplex price serving a variety of functionswage reflects a variety of factors23© 2002 McGraw-Hill Ryerson Ltd.Alternative PerspectivesNeoclassicalInstitutionalismDualismRadicalism24© 2002 McGraw-Hill Ryerson Ltd.End of Chapter One25© 2002 McGraw-Hill Ryerson Ltd.