# lec6 - ECONOMICS 175 Professor Ronald D. Lee 2/05/09...

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ECONOMICS 175 Professor Ronald D. Lee 2/05/09 Lecture 6 ASUC Lecture Notes Online is the only authorized note-taking service at UC Berkeley. Do not share, copy or illegally distribute (electronically or otherwise) these notes. Our student-run program depends on your individual subscription for its continued existence. These notes are copyrighted by the University of California and are for your personal use only. D O N O T C O P Y Sharing or copying these notes is illegal and could end note taking for this course. Announcement Problem sets must be in the box in class by 2:10 or in the Demography Building in the box in the hall before class. Late problem sets will not be accepted at all. Ones turned in last Tuesday at the end of class we will accepted but will be marked down, and from now on we will not accept them. There is one person who tried to submit it at the end of class but I said he could not. If that is you, come see me after class. If the number to register your Iclicker is rubbed off or something, come to me with your name and SID on a piece of paper and I will fix it. I will post information on bSpace so if you have a problem with this please let me know. Problem set 2 is due February 17 th , not February 19 th as it says on the problem set. Sections will meet in 64 Barrows again next week. Wednesday 2-3 will move to 1-2. There will be regular office hours next week even though the syllabus says there won't. Q1: Choose the most inclusive answer: In the labor- leisure model for a married couple, assuming leisure is a normal good, if the husband’s income is higher, then the model implies that: A. The wife will supply less labor outside the home B. The outcome is ambiguous because the income and substitution effects go in opposite directions C. Household utility will be higher D. B and C are both true E. A and C are both true If her leisure is a normal good she will take more of it so A is correct. There are no substitution effects in this case, just the income effect. B is incorrect. C. is correct but E is actually the right answer. Outline 1. Changing women's economic roles in the Third World 2. Changing women’s roles in the U.S. Female Labor in Economic Development Graph: Female Labor Force Participation. We saw last week that female educational attainment rises with income. Now we are taking female labor force participation for women aged 45-59. We use older women to avoid getting mixed up with issues of fertility. We see this U shape that is found in other studies. The pattern looks very similar from 1970 through 1985. It is like the relationship between education attainment and income (stable relationship over time). It appears that at the lowest levels of income when income rises, female labor force participation drops rapidly. There is a region in the middle where the graph is fairly flat. Higher levels of GDP cause it then to rise. Why might this be the case? We might expect that

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## This note was uploaded on 01/28/2010 for the course ECON 175 taught by Professor Lee during the Spring '08 term at University of California, Berkeley.

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lec6 - ECONOMICS 175 Professor Ronald D. Lee 2/05/09...

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