Supply of labour (OCR A-Level Economics): Flashcards

Measures responsiveness of quantity of labour supplied to wage change

Payment in excess of what's needed to keep factor in current use

Min. payment to keep factor in current use (opportunity cost)

Higher wages attract more workers to an industry

Higher wages may reduce quantity of labour supplied (more leisure)

Industries with specialized skills have lower supply of labour

Licensing/certification restricts supply of labour

Aging population reduces the supply of labour

High unemployment increases supply of labour to an industry

Generous benefits reduce incentive to work, reducing supply

More inelastic (specialized skills, lengthy training required)

More elastic (workers can easily enter/exit with minimal training)

More elastic (workers have time to adjust, acquire new skills)

$£20$ per hour