LABOR ECONOMICS Ning Guangjie 7el:23504565 E-mail:seanning@eyou.com
1 LABOR ECONOMICS Ning Guangjie Tel: 23504565 E-mail:seanning@eyou.com
Chapter 1 INTRODUCTION 1. 1 What does labor economics study? Labor economics studies how labor markets work Such as labor force participation, the firms demand for the high-skill workers, wage determination, the human capital investment, the labor mobility, the labor market discrimination trade Unions and unemployment
2 Chapter 1 INTRODUCTION 1.1 What does labor economics study? • Labor economics studies how labor markets work. • Such as labor force participation, the firm’s demand for the high-skill workers, wage determination, the human capital investment, the labor mobility, the labor market discrimination, trade Unions and unemployment
The actors in the labor market workers(utility maximum), firms(profit maximum)and government(influence the supply and demand or change the rules of the game) Learning labor economics can help you have a better understanding of the real labor economic problems and predict the labor market outcomes
3 The actors in the labor market: workers(utility maximum), firms(profit maximum)and government(influence the supply and demand or change the rules of the game) Learning labor economics can help you have a better understanding of the real labor economic problems and predict the labor market outcomes
1.2 Theory and facts The theory helps us understand how the facts are generated, and where the facts can help shape our thinking about the way labor markets work Model: simplify; The realism of assumption to the extent to which it helps us understand and predict how labor markets work
4 • The theory helps us understand how the facts are generated, and where the facts can help shape our thinking about the way labor markets work. • Model: simplify; The realism of assumption to the extent to which it helps us understand and predict how labor markets work. 1.2 Theory and facts
1.3 The organization of the course Chapter 2 Labor supply Chapter 3 Labor Demand Chapter 4 Labor Market Equilibrium Chapter 5 Human Capital Chapter 6 Contract and Work Incentive · Chapter7 Trade Union Chapter 8 Labor mobility Chapter 9 Unemployment Appendix: An introduction to Regression Analysis
5 1.3 The organization of the course • Chapter 2 Labor supply • Chapter 3 Labor Demand • Chapter 4 Labor Market Equilibrium • Chapter 5 Human Capital • Chapter 6 Contract and Work Incentive • Chapter 7 Trade Union • Chapter 8 Labor Mobility • Chapter 9 Unemployment • Appendix: An introduction to Regression Analysis
Chapter 2 Labor Supply Whether to work and how many hours to work Labor supply in short run, static labor supply decision, In long run 2. 1 Some stylized facts about labor supply Measuring the labor force) BLS CPS The employed(e, a worker must have been at a job with pay for at least I hours, or worked at least 15 hours on a non- paid job such as the family farm the unemployed(u, a worker must either be on a temporary layoff from a job, or have no job but be actively looking for work in the 4-week period prior to the reference week), out of the labor force the population(p)
6 Chapter 2 Labor Supply Whether to work and how many hours to work Labor supply in short run, static labor supply decision, in long run 2.1 Some stylized facts about labor supply • Measuring the labor force(LF): BLS CPS • The employed(E, a worker must have been at a job with pay for at least 1 hours, or worked at least 15 hours on a non-paid job such as the family farm ), the unemployed(U, a worker must either be on a temporary layoff from a job, or have no job but be actively looking for work in the 4-week period prior to the reference week) , out of the labor force, the population(P)
LF=E+U Labor force participation rate=LF/P Unemployment rate=U/LF The official unemployment rate understated the real condition of unemployment. Discouraged workers, hidden unemployed Labor force participation rate, Hours of work in the u.s The participation rate of men declined from nearly 90 percent in 1900 to 76 percent by 1990 An ever-larger fraction of men choose to retire earlier
7 LF=E+U, Labor force participation rate=LF/P Unemployment rate=U/LF The official unemployment rate understated the real condition of unemployment. Discouraged workers, hidden unemployed. Labor force participation rate, Hours of work in the U.S. The participation rate of men declined from nearly 90 percent in 1900 to 76 percent by 1990. An ever-larger fraction of men choose to retire earlier
The huge increase in the labor force participation rate of women a sizable decline in average hours of work per week prior to 1940
8 • The huge increase in the labor force participation rate of women. • A sizable decline in average hours of work per week prior to 1940
年劳动时间(小时)的国际比较 日本 美国 西德 国 法国 975 1678 1830 1893 2l68 1989 2159 1638 1989 l646 资料来源:[曰]永山武夫:《劳动经济——日本的经营与劳动问题》,第107页
9 年劳动时间（小时）的国际比较 年份 日本 美国 西德 英国 法国 1975 2043 1881 1678 1923 1830 1980 2162 1893 1985 2168 1929 1659 1952 1643 1989 2159 1957 1638 1989 1646 资料来源：[日]永山武夫：《劳动经济——日本的经营与劳动问题》，第107页
2.2 The worker's preferences and budget constraints Utility function: U=U(C, L) C, consumption of goods. L, consumption of leisure. U=CL Indifference curve Marginal utility Marginal rate of substitution in consumption Time constraints T=L+h L: leisure time. h: work time Budget constraint: C=wh+V V: non-labor income C=(WT+V)-wL budget line the boundary of the workers opportunity set Slope -w
10 2.2 The worker’s preferences and budget constraints Utility function: U=U(C, L) C, consumption of goods. L, consumption of leisure. U=C*L Indifference curve Marginal utility Marginal rate of substitution in consumption Time constraints: T=L+h L: leisure time; h: work time Budget constraint: C=wh+V V: non-labor income C=(wT+V)-wL budget line the boundary of the worker’s opportunity set Slope -w