F583 - Economics of Work and Leisure - June 2014

well there's a multitude of methods that the Government can use to improve labour market flexibility - cutting marginal income tax rates, cutting JSA, reducing employment legislation and education and training. All these methods have their own way of improving flexibility (which im too tired to go through right now haha) but the common theme is that these methods will encourage workers to work more and thus increase their supply of labour to the area's where labour shortages are occurring (in theory), hence improving labour market flexibility (however with employment legislation, reducing employment legislation will increase firms demand for labour, it won't affect the supply)

So basically the diagram im talking about is the interaction of the Aggregate Demand for Labour (ADL) and the Aggregate Supply of Labour (ASL), and you'd show the ASL line moving outwards to indicate the increase in the supply of labour which has helped to improve labour market flexibility (numerical/temporal/locational/functional/wage) as firms now have access to a larger pool of workers, and unemployment will in theory decrease, as labour shortages should no longer occur, and the labour market will now have a better response to changing market conditions.

hopefully that helps, but if there's anything you don't understand just let me know and i'll try and explain it


so in your analysis you're basically analysing how these measures by the government to improve labour market flexibility will improve the different components of labour market flexibility - so numerical/functional/temporal/wage/locational flexibility

Thank you! It was the last bit i wasn't getting ( how the increase in supply will fill labour shortages and how the larger pool of workers would allow the labour market to respond better to changing market conditions)

Have you done all the papers?

that bit about the larger pool of workers allowing the labour market to respond better to changing market conditions - i basically mean that because numerical/locational/functional/wage/temporal flexibility will be improved by these government measures, then lets say a recession hits, firms will be able to adjust quickly (in terms of their usage of labour) so they could drop the wage rate significantly, increase the number of hours workers work quickly, and they can move workers around different sectors of their firm and have them performing different tasks almost straight away, so they wouldn't have to resort to laying off workers to cut down on their costs, hence a flexible labour market would see less unemployment arising, hence why the labour market can react better to changing market conditions.

ive done most of them yeah, just noticed there's the january 2010 that i haven't done, so i'll be doing that tomorrow

Thanks!!
Which year have you done up to, 2002?
Another thing which confuses me is the substitution/income effect on backward sloping supply curve. So when a worker initially has a lower wage, the substitution effect would dominate where the worker would substitute work for leisure or is it substitute leisure for work??? (I'm trying to say they're swapping free time for work as the opportunity cost of not working is higher)
I think this is more of an English language question than Economics D:

What diagram could I use for economic inactivity as a cause of labour market failure?

can wage determination/ageing population/labour market failure come up in part A data response

Thanks! You know examples of labour markets?

I feel like I know market failure and corrections to them more than anything else on this topic what are the chances that a market failure question will come up as a section b question/s?

They've actually done TV boradcasting, Cinema and Camping.
Predicting tomorrow coud be something to do with spectator sports actually!

can wage determination/ageing population/labour market failure come up in part A data response

have they done cinemas? i know spectator sports has been done before, but don't remember seeing cinemas in any of the past papers? :/

Yeah i remember it was on market concentration rations and stuff, when did spectator sports come up?

Yeah i remember it was on market concentration rations and stuff, when did spectator sports come up?

Standard ADL/ASL diagram showing an inward shift of ASL

Whats ADL and ASL?