Consider an economy with two labour markets, neither of which is unionized. Now suppose a union is

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Consider an economy with two labour markets, neither of which is unionized. Now suppose a union is established in one market.

a. Show the effect of the union on the market in which it is formed. In what sense is the quantity of labour employed in this market an inefficient quantity?

b. Show the effect of the union on the non-unionized market. What happens to the equilibrium wage in this market?

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Economics

ISBN: 9781408093795

3rd Edition

Authors: Mark P. Taylor, N. Gregory Mankiw

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Question Posted: Nov 04, 2024 07:01 AM

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Consider an economy with two labour markets, neither of which is unionized. Now suppose a union is

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