econ201 exam2study

econ201 exam2study - The determinants of average labor...

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The determinants of average labor productivity 1. Human Capital – talents, education, training, skills 2.Physical Capital – tools 3.Natural Resources 4.Technology 5.entrepreneurship and management quality Workers, wages, and unemployment in the modern economy Five important Labor Market Trends 1. Over 20 th cent all industrialized countries have had substantial growth in real wages 2. Since 1970’s real wage growth has slowed 3. Pronounced increase in wage inequality in US 4. The num of ppl with jobs has grown 5. Western European counties have been suffering high rates of unemployment for almost 2 decades Diminishing returns to labor – if the amount of capital and other inputs in use is held constant then the grater the quanitiy of labor already employed, the less each additional worker adds to production Shifts in labor higher price of output -> increase demand for labor higher productivity -> increase the demand for labor High rate of money growth -> inflation velocity=nominal gdp/money supply
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This note was uploaded on 02/05/2009 for the course ECON 201 taught by Professor Shea during the Fall '08 term at Maryland.

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econ201 exam2study - The determinants of average labor...

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