【正文】 2020 Pearson AddisonWesley –The monopsony pays the lowest wage rate for which that quantity of labor will work. –Compared to a petitive labor market, the monopsony employs fewer workers and pays a lower wage rate. Labor Markets 169。 2020 Pearson AddisonWesley –Individual’s Supply of Labor Curve –At low wage rates the substitution effect dominates the ine effect, so a rise in the wage rate increases the quantity of labor supplied. –At high wage rates the ine effect dominates the substitution effect, so a rise in the wage rate decreases the quantity of labor supplied. –The labor supply curve slopes upward at low wage rates but eventually bends backward at high wage rates. Labor Markets 169。 2020 Pearson AddisonWesley ?The Price of the Firm’s Output ?The higher the price of a firm’s output, the greater is the firm’s demand for labor. ?The price of output affects the demand for labor through its influence on the value of marginal product of labor. ?If the price of the firm’s output increases, the demand for labor increases and the demand for labor curve shifts rightward. The Demand for a Factor of Production 169。 2020 Pearson AddisonWesley –The demand for a factor of production is a derived demand—it is derived from the demand for the goods that it is used to produce. –The quantities of factors of production demanded are a consequence of firms’ output decisions. –A firm hires the quantities of factors of production that maximize its profit. –The value to the firm of hiring one more unit of a factor of production is called the value of marginal product. The Demand for a Factor of Production 169。 2020 Pearson AddisonWesley 18 MARKETS FOR FACTORS OF PRODUCTION 169。 2020 Pearson AddisonWesley The Tragedy of the Commons The Overuse of a Common Resource Figure shows why overfishing occurs. The supply is the marginal private cost curve, MC. The demand is the marginal social benefit curve, MSB. Market equilibrium occurs at 800,000 tons per year and $10 a pound. 169。 2020 Pearson AddisonWesley Negative Externalities: Pollution Government Actions in a Market with External Costs There are three main methods that the government uses to cope with external costs: ? Taxes ? Emission charges ? Capandtrade 169。 2020 Pearson AddisonWesley External Cost and Output Figure illustrates the MC curve, the MSC curve, and marginal external cost as the vertical distance between the MC and MSC curves. Negative Externality: Pollution 169。 2020 Pearson AddisonWesley 169。 2020 Pearson AddisonWesley Negative Externality: Pollution Many scientists believe that carbon dioxide emissions are a major cause of global warming and climate change. The effects of pollution mean that production and consumption decisions impose costs that are not taken fully into account when decisions are made. You are now going to see how economists analyse these decisions and solve the pollution problem. 169。 2020 Pearson AddisonWesley Figure illustrates how the establishment of property rights achieves an efficient oute. The producer of the good bears all the costs. The market oute is efficient because at the quantity of the good produced MSC equals MSB. Negative Externality: Pollution 169。 2020 Pearson AddisonWesley The Tragedy of the Commons The tragedy of the mons is the overuse of a mon resource that arises when its users have no incentive to conserve it and use it sustainably. Examples include the overfishing of Atlantic Ocean cod and South Pacific whales. The traditional example from which the term derives is the mon grazing land surrounding middleage British villages. 169。 2020 Pearson AddisonWesley The Tragedy of the Commons Individual Transferable Quotas An individual transferable quota (ITQ) is a production limit that is assigned to an individual who is free to transfer (sell) the quota to someone else. A market in ITQs emerges. If the efficient quantity of ITQs is assigned, the market price of an ITQ confronts resource users with a marginal cost equal to MC + price of ITQ. With MC + price of ITQ equal to MSB, the quantity produced is efficient. 169。 2020 Pearson AddisonWesley –Market for Capital Services –Capital consists of the tools, instruments, machines, buildings, and other constructions that have been produced in the past and that businesses now use to produce goods and services. –These physical objects are capital goods and capital goods are traded in goods markets. This market is not a market for capital services. –A market for capital services is a rental market—a market in which the services of capital are hired. The Anatomy of Factor Markets 169。 2020 Pearson AddisonWesley –Figure shows the relationship between a firm’s value of marginal product and its demand for labor.