1. Markets and Oligopsony and Monopsonistic Competition
The positive employment effects exists because of different reservation wages across employees that cause the firm's labor supply face upwards which means employment of additional workers will cause the marginal cost of the firm to exceed the wage. Besides, introduction of minimum wage causes a rapid increase in worker's reservation wages that will induce the firms to pay wage more than the minimum. ... (Bashkar, Manning and To,2002) The increase of wage rate to the minimum by the competitors will cause the firm's labor supply curve shifts left. ... For the case of profits for t...
- Word Count: 2083
- Approx Pages: 8
- Has Bibliography
- Grade Level: Undergraduate