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The steelworkers' union is a monopoly union. What is the efficiency cost of the union arrangement in this industry to the economy?
What is the union wage gap? What is the union wage gain? What is the impact of the union on the wage in the nonunion sector?
Derive the steady-state rate of unemployment. Show how it depends on the transition probabilities between employment and unemployment.
Should a job seeker pursue a non-sequential or a sequential search strategy? Derive a job-seeker's asking wage.
What is the intertemporal substitution hypothesis? Does this argument provide a convincing account of the cyclical trend in the unemployment rate?
Why do efficiency wages generate involuntary unemployment? exercise 4 What factors prevent the market from clearing in efficiency wage models?
Does search theory help you understand why the unemployment rate of young workers differs from the unemployment rate of older workers?
What is the impact of the proposed legislation on the wage and on the unemployment rate for workers in this economy?
Why is there a difference between the private gains to migration and the family's gains to migration? Why Can both the husband and the wife be tied movers?
Show how cohort effects in the immigrant flow affect the interpretation. Define the immigration surplus, and discuss how it can be calculated.
How should one interpret the fact that all else being equal-workers with a great deal of seniority earn more than newly hired workers?
Finally, the worker's rate of discount is 10 percent. What is the highest level of migration costs that a worker is willing to incur and still make the move?
Explain why a firm which is making losses in The hart run might increase its output in the long run while the output of the industry falls.
Why is the principal-agent problem relevant to understanding how CEOs should be compensated?
Why is there mandatory retirement in many countries? What factors create the link between wages and productivity that is at the heart of efficiency wage models?
How will the workers sort themselves across firms? Suppose that a decrease in demand for the firm's output cuts the price of the output by half.
Taxicab companies in the United States typically own a large number of cabs. Why did this type of compensation system develop in the taxicab industry?
Suppose you were employed by a multinational car manufacturer. What opportunities might there be for you to display the characteristics of entrepreneurship?
Use a diagram to illustrate that not all members of union can expect to benefit from this in long run. How might an increase in productivity alter this diagram?
Use supply and demand analysis to predict how the wages of pilots subsequently altered during times of increased economic activity.
Why are the promoters of a recital by Pavarotti able to pay the artist high wages because of the high-ticket prices they can charge for admission.
Explain why an economist might not agree that this represents a true picture of the shop's profit-ability.
What is the interbank market, and why is it important? Does the existence of a Euro-currency market make monetary control more difficult in the UK?
What is the purpose of the lender of last resort facility? Why is there a conflict between liquidity and profitability for the retail banks
In what circumstances might a rise in the rate of interest persuade an individual to cut down on the amount of money saved per period of time?