Econom 1014 exam 1 study guide principles of

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Chapter 10 / Exercise 3
Macroeconomics
Roger A. Arnold
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ECONOM 1014 Exam 1 Study Guide Principles of Microeconomics - Klein pg. 17 Hire more workers as long as MRP > wage Don’t hire where MRP < wage Different pay innate attractiveness of a job monetary compensation non monetary aspects eg. Teachers get spring/summer/winter breaks Academic economists 50-75% of what economists earn working in industry S Dl=MRPl q of labor wag e rate Monopsony: single buyer Monopson y is not a wage taker wage Dl = MRPl q of labor MlC Slabor optimal # of workers Monopsony employer: hire # of workers where MlaborC=MRPl wa ge
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Chapter 10 / Exercise 3
Macroeconomics
Roger A. Arnold
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ECONOM 1014 Exam 1 Study Guide Principles of Microeconomics - Klein pg. 18 Sunbelt vs Northeast lower wages Two jobs and one is intrinsically more attractive job→ Compensating wage differential better weather more time off If the other job is shittier than company pay difference in pay If job is better than other, company doesn’t pay as much because they don’t have to make up for the crappy aspects of other job Difference in money wages location/quality of life San Francisco Cost of living high weather nice companies pay less because nice weather of SF “makes up for it” physical exertion required if the work is hard on your back then you demand higher pay risk of injury also warrants higher pay development of human capital allows to better market yourself by temporarily taking lower wage Take lower wages to study at Harvard and then earn more later because you went to Harvard Police vs Firefighters identical skills equally suited for both police & fire consider Police work more dangerous fire is safer Higher wage → Police 25% higher price 4/29/2015 Discrimination in the Labor Market GOAL Hire most productive people
ECONOM 1014 Exam 1 Study Guide Principles of Microeconomics - Klein pg. 19 In 1992 .... Women earned about 70% as much as men Japanese~American families earned 28% more than the average of all white American families. Chinese-American earned 8% more than average American families. Jewish families earn 80% more than white, non-jewish families. Blacks of West Indies descent have slightly more income than whites But, black males as a whole earned 83% as much as white males. DIFFERENT GROUPS ARE PAID DIFFERENTLY [x2w34] Firms discriminating against women E.g. Fire all women working there May have higher costs for doing that, and hiring men away from other employers Non-discriminating firms hire the fired women Lower wage for women but have same MRP as men, so women will be preferred to maximize profit. Non-discriminating firms will hire no men until wage of women=wage of men. Earnings at end of career Factors Starting pay Raises typically % increases College graduates entering labor force during recession earn less This wage gap persists for 15-20 years Discriminate in favor of Chinese people (only hire Chinese)
ECONOM 1014 Exam 1 Study Guide Principles of Microeconomics - Klein

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