Chapter 4 Labor Market Equilibrium

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Chapter 4 Labor Market Equilibrium

• Order is not pressure which is imposed on society
  from without, but an equilibrium which is set up
  from within.
• -Jose Ortega y Gasset

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4.1 Equilibrium in a Single Competitive Labor
Market
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4.1 Equilibrium in a Single Competitive Labor
Market
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4.1 Equilibrium in a Single Competitive Labor
Market
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4.1 Equilibrium in a Single Competitive Labor
Market
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.2 Policy Application
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4.3 The cobweb model
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4.3 The cobweb model
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4.3 The cobweb model
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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4.4 Noncompetitive Labor Market Monopsony and
Monopoly
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Summary

• A competitive economy where a homogeneous group
  of workers and firms can freely enter and exit
  the market has a single equilibrium wage across
  all labor markets.
• There is no unemployment in a competitive labor
  market because all workers who wish to work can
  find a job at the going wage.
• A competitive equilibrium leads to an efficient
  allocation of resources. No other allocation of
  workers to firms generates higher gains from
  trade.

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Summary
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Summary
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Summary