Consider an economy with two labor marketsone for manufacturing workers and one for service workers. Suppose initially

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Consider an economy with two labor markets—one for manufacturing workers and one for service workers. Suppose initially that neither is unionized.

a. If manufacturing workers formed a union, what impact on the wages and employment in manufacturing would you predict?

b. How would these changes in the manufacturing labor market affect the supply of labor in the market for service workers? What would happen to the equilibrium wage and employment in this labor market?

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Principles of economics

ISBN: 978-0538453042

6th Edition

Authors: N. Gregory Mankiw

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Question Posted: Dec 14, 2012 06:11 AM

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Consider an economy with two labor marketsone for manufacturing workers and one for service workers. Suppose initially

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a Figure illustrates the effect of a union being established in the manufacturing l...View the full answer

Principles of economics

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