University:
McMaster University
Course:
ECON 1BA3 | Introductory Macroeconomics for Economics Students
Academic year:

2024
Views:

17

Pages:

1
Author:

Sabrina S.

Labour, wages and earnings Wages The price employer pays for labeur Forms of wages Direct mansy payments (comission, bomuses) 2) Fringe benefits (paid vacation, health insurance, pension) Wage rate: Price paid per unit of labour services (eg: per hour) Labour earnings: no. of hours worked x hourly wage rate Nominal wage Amount of money received per hour/day/y Real wage: Amount of goods a worker can obtain with nominal wage reveals the purchasing power of nominal wages. Role of Productivity greater the productivity of labour greater the demand for it 16 total supply of labour is Rised Stronger the demand for it higher the average nel of real wages Reasons for high productivity; Paale Plentiful capital Workers in advanced economies use large amounts of physical capital cauipment machinery buildings workers in advanced economies use equipment that is superior to the equipment avaliable for vast majority. Advanced technology in advanced economics, work methods improve through scientific restarch. ③ Access to abundant natural resouress In advanced economics, natural resources abundant compared to size of labour force Labour quality In advanced economies, the health education & training of workers = superior compared to those in developing nations. 6 workers more productive ⑤ Other Factors efficiency and Plesibility of management bua/social/political enviroment that emphasiars production + productivity a largr domestic markets enables incerased specialization of production Pirmo to engage in mass production