Econ chapter 28
Terms in this set (40)
What is the unemployment rate called when real and potential GDP are equal?
Unemployment arising from normal turnover in the labor market such as when people change occupations, location or are new entrance
Unemployment due to problems such as poor skills, long-term changes in demand, or insufficient work incentives
Unemployment that fluctuates depending on seasons, holidays, school, etc.
Unemployment due to a recession, when the rate of unemployment is above the natural rate of employment
All those who are either employed or unemployed
Person looking for a job but doesn't have one
Must have a job outside the home or a paid job inside the home
Those who have left the labor force after not being able to find a job
Part time worker
One who works between one and 34 hours per week
working age population
Person over 16 years of age who are not in an institution
Total number of hours worked by all workers in the economy in a given period of time
Refers to the loss of whole business firms as well as jobs with new ideas and techniques replace the old
Wage or price of labor adjusted for inflation; in contrast the normal wage has not been adjusted for inflation
Person who already works for a firm and has some influence over wage and hiring policy
Someone who isn't working for a particular firm making it difficult for them to get a job with a firm even though they are willing to work for a lower wage
What two types of unemployment cause the natural unemployment rate?
Frictional and Structural
At what percent is the natural unemployment rate currently?
Who conducts the current population survey?
US census bureau
About how many households does the current population survey use?
What percent of the labor force works part time?
What happened to the employment-to-population ratio in the past 20 years? Why?
Increased - reduced discrimination and increased opportunities for women
What happens to the unemployment rate when people drop out of the labor force because of a recession?
What are the four ways people are counted as unemployment?
What percent of jobs are lost each year because of creative destruction?
What percent of the unemployed comes from job leavers?
Which group is likely to experience the highest rate of unemployment?
Young minority males
According to the job rationing explanation the amount of unemployment depends on what?
Demand of labor
What happens to the supply of labor when a worker is paid the efficiency wage?
Excess supply of labor
Besides wanting to increase efficiency why else would a firm pay the efficiency wage?
To attract more skilled workers
Reduce job turnover
The best example of the insider versus outsider exclamation is what group?
Labor union influence
Which explanation argues that laws requiring wages be kept above a given amount prevent unemployed workers from being hired?
What two policies could cause the natural unemployment rate to decline?
-Lower minimum wage would reduce unemployment among teens
-Unemployment compensation increases unemployment
What might help unemployment from job search to decline?
Improving communications about the labor market
Which group has a higher unemployment rate : younger or older adults?
What percent of the average wage is unemployment compensation in the US? In Australia and Spain?
10%-US 40%-Australia and Spain
Stochastic equilibrium is the result of what?
The labor market is in a constant state of perpetual motion
Unemployment rate formula
UR = unemployed/labor force
Labor force participation rate formula
LFPR = labor force/Working age population
Employment to population ratio formula
EPR = employed/working age population