【正文】 e firm increasing its capitaltolabor ratio by 50%. 40 4. Marshall’s Rules of Derived Demand (The HicksMarshall Law of Derived Demand) The factors that influence ownwage elasticity can be summarized by the four “HicksMarshall Laws of Derived Demand.” These laws assert that, other things equal, the ownwage elasticity of demand for a category of labor is high under the following conditions: 41 1) When the price elasticity of demand for the product being produced high。 2) When other factors of production can be easily substituted for the category of labor。 3) When the supply of other factors of production is highly elastic。 4) When the cost of employing the category of labor is a large share of the total cost of production. Note: (1), (2) and (3) can be shown to always hold. There are conditions, however, under which the final law does not hold. 42 (1) DEMAND FOR THE FINAL PRODUCT The greater the price elasticity of demand for the final product, the larger will be the decline in output associated with a given increase in price and the greater the decrease in output, the greater the loss in employment (other things equal). Thus the greater the elasticity of demand for the product, the greater the elasticity of demand for labor will be. 43 (2) SUBSTITUTABILITY OF OTHER FACTORS Other things equal, the easier it is to substitute other factors in production, the higher the wage elasticity of demand will be. Note: (1) Sometimes collectively bargained or legislated restrictions make the demand for labor less elastic by reducing substitutability (not technically). (2) Substitution possibility that are not feasible in the short run may well bee feasible over longer periods of time, when employers are free to vary their capital stock. → The demand for labor is more elastic in the longer run than in the short run. 44 (3) THE SUPPLY OF OTHER FACTORS As the wage rate increased and employers attempted to substitute other factors of production for labor, the prices of these inputs were bid up substantially. Such a price increase would dampen firm’s appetites for capital and thus limit the substitution of capital for labor. Note: Prices of other inputs are less likely to be bid up in the long run than in the short run. → Demand for labor will be more elastic in the long run. 45 (4) THE SHARE OF LABOR IN TOTAL COSTS The greater the category’s share in total costs, the higher the wage elasticity of demand will tend to be. If the share of labor cost is large, cost increase due to wage increase is larger. The employer would have to increase their product prices by more, output and hence employment would fall more. Note: This law, relating a smaller labor share with a lesselastic demand curve, holds only when it is easier for customers to substitute among final products than it is for employers to substitute capital for labor. 46 FACTOR DEMANDS WHEN THERE ARE SEVERAL INPUTS ?There are many different inputs. ? Skilled and unskilled labor ? Old and young ? Old and new machines ?Crosselasticity of factor demand. ? %?Di?%?wj ? If crosselasticity is positive, the two inputs are said to be substitutes in production. 47 THE DEMAND CURVE FOR A FACTOR OF PRODUCTION IS AFFECTED BY THE PRICES OF OTHER INPUTS Price of input i Employment of input i D0 Price of input i Employment of input i D1 D0 D1 The labor demand curve for input i shifts when the price of another input changes. (a) If the price of a substitutable input rises, the demand curve for input i shifts up. (b) If the price of a plement rises, the demand curve for input i shifts down. (a) (b) 48 THE CROSSWAGE ELASTICITY OF DEMAND The elasticity of demand for input j with respect to the price of input k is the percentage change in the demand for input j induced by 1 percent change in the price of input k. ., δjk = %△ E j / %△ Wk δjk = %△ Ek / %△ Wj 49 If the cross elasticities are positive (with an increase in the price of one increasing the demand for the other) the two are said to be gross substitutes. If the cross elasticities are negative (and increase in the price of one reduces the demand for the other), the two are said to be gross plements. Note: Whether two inputs are gross substitutes or gross plements depends on both the production function and the demand conditions. → Knowing that two groups are substitutes in production is not sufficient to tell us whether they are gross substitutes or gross plements. 50 Q amp。 A ? Q1： 請(qǐng)舉出二個(gè)你所知道的以前存在但現(xiàn)在已經(jīng)沒(méi)有或很少見(jiàn)的工作。 (行業(yè)或職業(yè)均可 ) 。 ? Q2：請(qǐng)從網(wǎng)路世代 /行動(dòng)裝置的觀點(diǎn)解釋上述消逝的工作。 5