平狄克微觀經濟學第六版第十四章課后答案

1、CHAPTER 14MARKETS FOR FACTOR INPUTSTEACHING NOTESThe followingtwo chaptersexamine the markets for labor and capital. Although thediscussi on in this chapter is gen eral, most of the examples refer to labor as the only variable in put to producti on, with the excepti on of Example , which discusses“

2、The Dema nd for JetFuel” by airli nes. Labor dema nd and supply are discussed in the first secti on, and the competitive factor market equilibrium and economic rent are discussed in the second section. Secti on explores the factor market structure for the case where the buyer has mon ops ony power,

3、and secti on explores the case of mono poly power on the part of the seller of the factor.An un dersta nding of this chapter relies on con cepts from Chapters 4 through 8 and 10.If you have just covered Chapters11-13, you might beg in by review ingmarginal product,marg inal reve nue, and cost mini m

4、izati on. You should the n discuss marg inal reve nue product and the profit-maximizing conditionMRP= w . Explain why we are only interested in the portion ofthe MPcurve below the average product curve (the downward-sloping portion). The derivation of the firm s dema nd curvefor laboris straightforw

5、ardwhe n laboristhe onlyfactor, butbecomes more complicatedwhe n thereare several variable in puts.Inparticular, youmightexplain why theMRPcurve shifts as the firm substitutes one in put for another in productionin resp onse to a price cha nge by no ti ng that theMRPcurve is draw n for a fixed level

6、 of theother variable in put.When prese nting the market labordema nd curve, expla inthatsincethein put pricescha nge as more in putsare dema nded, themarket dema nd curve isnotsimplythesummati on ofin dividual dema nd curves. You can exte nd the prese ntati on of price elasticity of in put dema nd

7、(see Example by discuss ing the con diti ons leadi ng to price sen sitivity. Elasticity is greater (1) whe n the elasticity of dema nd for the product is higher, (2) whe n it is easy to substitute one in put forano ther,and (3) whe n the elasticity of supply is higher for other in puts.Elasticity of

8、 supply, which was discussed in Chapter 2, is reintroduced in Example . You should also distinguish between short-run and long-run elasticity (see Figure .If you have already covered substituti on and in come effects, the stude nts will be readyfor the derivationof the backward-bending supply curve

9、for labor. Although Figure is astraightforwardapplicati onof these tools,stude ntsareofte ncon fusedby theplott ingofin come aga inst leisure. Point out that this is just ano ther type of utility maximizati onproblem where the two goods are leisure and in come.In come can be thought of as thecon sum

10、pti on of goods other tha n leisure, in that more in come buys more goods. You can also implicitly assume that the price of other goods is $1 and the price of leisure is the wage.The supply of labor curve is derived by changing the wage and finding the new level of hoursworked. An in dividual s supp

11、ly curve of labor is backward bending only whe n the income effectdomin ates the substituti on effect and leisure is a no rmal good. Show typical supply curves for each group in Table . For an experimental study of the labor-leisure trade-off see Battalio,Green, and Kagel, “ In come-Leisure Tradeoff

12、 of Ani mal Wokers, ”America n Econo mic Review(September 1981).Secti on br ings together labor dema nd and supply for both competitive and mon opolisticproduct markets. Although econo mic rent was prese nted in Chapter 8, it is rein troduced withmore detail here. In Secti on , carefully expla in wh

13、y the marginal expe nditure curve is abovethe average expe nditure curve for a monopsoni st (see Figure . You can discuss how a mon ops onistwould price discri min ate, ., pay a differe nt wage rate to each employee. With perfect pricediscrim in ati on,the marginal reve nueexpe nditurecurve would co

14、in cide with the averageexpe nditure curve. Although mon ops ony exists in some markets, the exercise of mon ops ony poweris rare because of factor mobility.However, the employment of athletes by the owners ofMon ops ony Power in the Market forprofessi onal teams provides a good example (see Example

15、Baseball Players ” ).On this same topic,see Sommers and Quinton,Pay and Performanee inMajor League Baseball:The Case of the FirstFamily of Free Agents,Journal of Huma nResources (Summer 1982). Sectiondiscusses the case of unions to explore mono poly power onthe part of the seller of the in put.REVIE

16、W QUESTIONSmon opoly power1. Why is a firm s dema nd for labor curve more in elastic whe n the firm has in the output market than when the firm is producing competitivelyThe firm s dema nd curve for labor is determ ined by the in creme ntal reve nue fromhiringan additional unit of labor known as the

17、 marginal revenue product oflabor:MRp= ( MP)( MR the additional output (“ product ”)that the last workerproduced, times the additional revenue earned by sellingthat output. In acompetitive in dustry, the marginal reve nue curve is perfectly elastic and equalto price. For a monopolist, marginal reven

18、ue is downward sloping. As morelabor is hired and more output is produced, the mono polist will charge a lowerprice and marginal revenue will diminish.All else the same, marginal revenueThis implies that the margi nalproduct will be smaller for the monopolist.than for the competitivereve nue product

19、 for the mono polistis more in elastic firm.2. Why might a labor supply curve be backward bendingA backward-be nding supply curve for labor may occur whe n the in come effect of anin creasein the wage rate domin ates the substituti on effect. Labor supplydecisi ons are made by in dividualschoos ing

20、the most satisfy ingcomb in ati onofwork and other (leisure) activities. With a larger in come, the in dividual can afford to work fewer hours: the in come effect. As the wage rate in creases, the value of leisure time (the opportu nity cost of leisure) in creases, thus in duc ing the in dividual to

21、 work lon ger hours: the substituti on effect. Because the twoeffects work in opposite directions, the shape of an individual s labor supplycurve depe nds on the in dividual s prefere ncesfor in come,con sumpti on,andleisure.3. How is a computer compa ny s dema nd for computer programmers a derived

22、dema ndA computer compa ny s dema nd for in puts, in clud ing programmers, depe nds onhowmany computers it sells. The firm s dema nd for program ming labor depe nds on (is derived from) the dema nd it faces in its market for computers. As dema nd for computers shifts, the dema nd for programmers shi

23、fts.4. Compare the hiring choices of a monopsonistic and a competitive employer of workers.Which will hire more workers, and which will pay the higher wages Explain.Since the decision to hire another worker means the monopsonist must pay ahigher wage for all workers,andnot just thelastworkerhired,it

24、smarginalexpenditurecurve lies abovetheinput supplycurve (theaverageexpenditurecurve).The monopsonist sprofit-maximizinginputdemand,wherethemarginalexpenditurecurve intersectsthemarginal revenueproductcurve,willbe lessthan thecompetitor s profit -maximizing inputchoice,wheretheaverageexpenditure cur

25、ve intersects the demand curve. The monopsonist hires less labor,and the wage paid will be less than in a competitive market.5. Rock musicians sometimes earn over $1 million per year. Can you explain such large incomes in terms of economic rentEconomic rent is the difference between the actual payme

26、nt to the factor of production and the minimum amount that the factor is willing to accept. In thiscase, you might assume that there are a limited number of top-quality rock musicians who will continue to play rock music no matter what they are paid. This results in a perfectly inelastic supply curv

27、e, or something close to it. Given the high demand for rock music, the wage will be very high and there willbe a lot of economic rent. If there was a larger supply of top-quality rock musicians, or a more elastic supply, then the economic rent would be smaller.6. What happens to the demand for one i

28、nput when the use of a complementary input increasesIf the demand for the complementary input increases, the demand for the given input will increase as well. When demand for the complementary input increases,there is an increase in the quantity hired and possibly the price paid. Both ofthese change

29、s will increase theMRPof the given input, and hence will increaseWhether the prices of thethe quantity hired and possibly the price paid.7.inputs increasesfirm.For a monopsonist,depends on the degree ofwhat is the relationshipmonopsony power on the partbetween the supplyof theof an input and theall

30、units themarginal expenditure on itThe decision to increase employment means the monopsonist must payTherefore, its marginalhigher price, and not just the last unit hired. expenditure curve lies above the input supply curve (the average expenditure curve). Hiring more labor will increase the margina

31、l expenditure, which will increase the average expenditure. If the average expenditure is increasing, then the marginal expenditure must be greater than the average expenditure.8. Currently the National Football League has a system for drafting college players by which each player is picked by only

32、one team. The player must sign with that team or notplay in the league. What would happen to the wages of newly drafted and more experienced football players if the draft system were repealed, and all teams could compete for college playersThe National Football League draft and reserve clause (a pri

33、mary issue in the1987-1 988 season s strike) creates a monopsonist cartel among the owners of NFLteams. If the draft system were repealed, competition among teams would increase wages of football players to the point where the marginal revenue product of each player would be equal to the player s wa

34、ge.9. The government wants to encourage individuals on welfare to become employed. It is considering two possible incentive programs for firms.A. Give the firm $2 per hour for every individual on welfare who is hired.B. Give each firm that hires one or more welfare workers a payment of $1000 per yea

35、r, irrespective of the number of hires.To what extent is each of these programs likely to be effective at increasing the employment opportunities for welfare workersFirms will hire additional labor as long as the extra benefit is greater thanthe extra cost of hiring the worker, or until MRPL = w. Op

36、tion A would be effective because if the firm receives $2 per hour for every welfare worker hired then the effective wage paid, w, will fall and the firm will find it optimal to hire more labor until the benefits (MRPL) again equal the costs (w)at the margin.Option B would be effective at increasing

37、 employmentopportunities also in that if the firm hires an individual who has been on welfare they will then receive $1000. However, plan B is not necessarily as effective as plan A given the firm only receives one lump sum payment regardless of the number of welfare workers hired. In this case the

38、firm onlyhas an incentiveto hire the one welfare worker, though they may of course choose to hire more tha n one welfare worker.10. A small specialty cookie compa ny, whose only variable in put is labor, finds that theaverage worker can produce 50 cookies per day, the cost of the average worker is $

39、64 perday, and the price of a cookie is $1. Is the cookiecompany maximizingits profitExplai n.The marginal product of labor is 50 (cookies per day) and the price per cookieis 1 ($ per cookie) so the marginal reve nue product is $50/day. Since this isless than the wage of $64 per day the cookie compa

40、ny is not maximizing profit.They are emplo ying too much labor since the cost of labor is greater tha n theben efit of labor at the margi n, and are therefore produc ing too many cookies.11. A firm uses both labor and mach ines in producti on. Expla inwhy an in creasein theaverage wage rate causes b

41、oth a moveme nt along the labor dema nd curve and a shift of thecurve.An in crease in the wage rate causes an upward moveme nt along the labor dema ndcurve. For any give n marginal reve nue product curve, the firm will find thatthey want to hire fewer workers whe n the wage in creases (an upward mov

42、eme nt).However,whe nthewage in creasesthe margi nal costwillin crease which willreduce desired output. When output falls, the firm will not need as many machinesandthemarginal product of labor curvewillshift to the left,assum ingmach ines and labor are compleme ntary.This will also reduce thedema n

43、d for labor.EXERCISES1. Suppose that the wage rate is $16 per hour, and the price of the product is $2.Values for output and labor are in un its per hour.qL00201352473574655706a. Find the profit-maximiz ing qua ntity of labor.From the information given above, calculate the marginal product of labor,

44、 theextra output produced by hiri ng one more un it of labor, and the n multiply byprice to get the marginal revenue productof labor. To find the profitmaximizing quantity of labor, use the rule that the firm wants to hire laboronly aslong as the marginalrevenue productof labor isgreaterthanthenomin

45、al wage, or up to the point where the marginal reve nue product of laboris equalto the nominal wage. From the table below,thefirm will hire 5rateun its of labor.qLMRMRR002012040352153047312245741020655816706510b. Suppose that the price of the product remains at $2 but that the wage in creases to $21

46、. Find the new profit-maximiz ing qua ntity of labor.The above tabledoesnot changeforthis partof the problem. However,thefirm no lon gerwantsto hire 5un its oflaborbecause the ben efit of the 5 thun it ($16 per hour) is less tha n the cost of the 5th un it ($21 per hour). Thefirm would only hire 3 u

47、n its of labor per hour since in this case the ben efitstill exceeds the cost at the margin. The firm would stick with 3 unitsin stead of 4 unl ess fracti onal un its are possible. At L=4 the cost is greaterthan the ben efit so you lose profit by hiri ng the 4thunit of labor.c.Suppose the price of t

48、he productin creasesto $3 and the wage rema ins at $16 perhour. Find the new profit-maximizing quantity of labor.A cha nge in the price of the product will not cha nge the marg inal product oflabor, but it will change the marginalrevenue productof labor. The newmarginal revenue product of labor is g

49、iven in the table below. The firm willstill want to hire 5 units of labor, as in part a above. It will not hire the6th un it because the extra ben efit is less tha n the extra cost. Profit will be$16,anygreater tha n in part a.qLMPMRP002012060352154547312365741030655824706515d. Suppose that the pric

50、e of the product remains at $2 and the wage rema ins at but there is a tech no logicalbreakthrough thatin creasesoutput by 25% forgiven level of labor. Find the new profit-maximizing quantity of labor.The tech no logical breakthrough cha nges the n umber of un its of output producedby a given number

51、 of units of labor, and hence changes the marginal product and the marginal reve nue product of labor. The new output values are found by multiplyingthe old values by . This new informationis given in the tablebelow. The firm will still choose to hire 5 units of labor. Profit will be greater tha n i

52、n part a.qLMPMRP00-25125502315304255102062. Assume that workers whose in comes are less tha n $10,000 curre ntly pay no federal in cometaxes. Suppose a new gover nment program guara ntees each worker $5,000, whether or not he orshe earns any in come. For all earned in come up to $10,000, the worker

53、must pay a 50percenttax. Draw the budget line facing the workers under this new program. How is theprogram likely to affect the labor supply curve of workersThe budget line for workers under this program is a straight line at $5,000.This line is show n in the figure and table below. Workers earn $5,

54、000 whetherthey work or not. If workers work only to earn in come, ., there are no otherben efits such as“ gett ing out of the house ” or“ gaining experie nee,” thereis no incen tiveto work un der the new program. Only wages yieldi ng in comesgreater tha n $10,000 will result in a positive labor sup

55、ply.In come$10,000 $5,000 Thousa nds of Hours per YearFigureIn comeAfter TaxGover nmentTotal005,000$5,000$1,0005004,5005,0002,0001,0004,0005,0003,0001,5003,5005,0004,0002,0003,0005,0005,0002,5002,5005,0006,0003,0002,0005,0007,0003,5001,5005,0008,0004,0001,0005,0009,0004,5005005,00010,0005,00005,000S

56、ubsidyIn comeIn comea.A famous tennis star is paid $100,000 forappearingin a 30-secondtelevision3. Using your kno wledge of marg inal reve nue product, expla in the follow ing:commercial. The actor who plays his doubles part ner is paid $500.Margi nalreve nueproduct oflabor,MRPis equalto margi nalreve nue fromanin creme ntalun itof outputmultipliedby themargi nalproduct fromanin creme ntalun itof labor,or inotherwords, theextra reve nue gen eratedbyhav ing the tennis star appear in the ad. The famous tennis star is abl