1. Some city governments require that all city employees live within the city limits. What impact does this have on labor supply and the elasticity of demand for employees of a city with such a requirement?
2. One innovation in railroads has been to eliminate the caboose from trains, cutting train crews from 4 workers to 3. The unions resisted this because of the loss of jobs. Is the concern legitimate? Would removing the caboose cause a decline in total railroad employment? Consider the short-run and long-run effects. What factors does the answer depend on?