【正文】 copyright 169。 2020 by Harcourt, Inc. What Causes the Labor Demand Curve to Shift? ?Output Price ?Technological Change ?Supply of Other factors Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Value of the Marginal Product and the Demand for Labor ?To maximize profit, the petitive, profitmaximizing firm hires workers up to the point where the value of marginal product of labor equals the wage. VMPL = Wage Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Diminishing Marginal Product of Labor ?As the number of workers increases, the marginal product of labor declines. ?As more and more workers are hired, each additional worker contributes less to production than the prior one. ?The production function bees flatter as the number of workers rises. This property is called diminishing marginal product. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Production Function and The Marginal Product of Labor The production function illustrates the relationship between the quantity of inputs used and the quantity of output of a good. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Market for the Factors of Production The demand for a factor of production is a derived demand. ?A firm’s demand for a factor of production is derived from its decision to supply a good in another market. Harcourt, Inc. items and derived items copyright 169。The Economics of Labor Markets Chapter 18 Copyright 169。 2020 by Harcourt, Inc. The Demand for Labor Labor markets, like other markets in the economy, are governed by the forces of supply and demand. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. How the Competitive Firm Decides How Much Labor to Hire L a b o rLO u t p u tQM a r g i n a l P r o d u c t o f L a b o rM P LV a l u e o f t h eM a r g i n a l P r o d u c to f L a b o rV M P L = P x M P LW a g eWM a r g i n a l P r o f i t0 01 100 100 $ 1 , 0 0 0 $500 $5002 180 80 $800 $500 $3003 240 60 $600 $500 $1004 280 40 $400 $500 $ 1 0 05 300 20 $200 $500 $ 3 0 0D Pr o f i t V M P L W= MPL Q/ L= D DHarcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Production Function... 0 0 50 100 150 200 250 300 350 0 1 2 3 4 5 6 Quantity of Apple Pickers Quantity of Apples 1 2 3 4 5 Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Value of the Marginal Product and the Demand for Labor The valueofmarginalproduct curve is the labor demand curve for a petitive, profitmaximizing firm. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Labor Supply Curve ?The labor supply curve reflects how workers’ decisions about the laborleisure tradeoff respond to changes in opportunity cost. ?An upwardsloping labor supply curve means that an increase in the wages induces workers to increase the quantity of labor they supply. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Equilibrium employment, L Equilibrium in the Labor Market... Supply Wage (price of labor) Quantity of Labor 0 Demand Equilibrium wage, W Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. A Shift in Labor Demand... Wage (price of labor) W1 0 Quantity of Labor L1 Supply Demand, D1 2. ...increases the wage... 3. ...and increases employment. 1. An increase in labor demand... D2 W2 L2 Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Productivity and Wage Growth around the World C o u n t r yG r o w t h R a t e o f P r o d u c t i v i t yG r o w t h R a t e o f R e a l W a g e sS o u t h K o r e a 8 . 5 7 . 9H o n g K o n g 5 . 5 4 . 9S i n g a p o r e 5 . 3 5 . 0I n d o n e s i a 4 . 0 4 . 4J a p a n 3 . 6 2 . 0I n d i a 3 . 1 3 . 4U n i t e d K i n g d o m 2 . 4 2 . 4U n i t e d S t a t e s 1 . 7 0 . 5B r a z i l 0 . 4 2 . 4M e x i c o 0 . 2 3 . 0A r g e n t i n a 0 . 9 1 . 3I r a n 1 . 4 7 . 9Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. The Markets for Land and Capital... Quantity of Land Quantity of Capital Q Q P P 0 0 Rental Price of Land Rental Price of Capital Demand Demand Supply Supply (a) The Market for Land (b) The Market for Capital Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Linkages Among the Factors of Production A change in earnings of any factor can be found by analyzing the impact of the event on the value of the marginal product of that factor. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Summary ?Because factors of production are used together, the marginal product of any one factor depends on the quantities of all factors that are available. ?As a result, a change in the supply of one factor alters the equilibrium earnings of all the