LABOR ECONOMICS (LL+ACCESS)
8th Edition
ISBN: 9781264909339
Author: BORJAS
Publisher: MCG
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Question
Chapter 12, Problem 9P
(a)
To determine
Explain the workers’ optimal job search strategy.
(b)
To determine
Explain how firms compete over workers, if all workers earn the same wage.
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Kuwait, among other gulf countries, is implementing a national program aimed at the gradual replacement of non-Kuwaitis by Kuwaitis over the next years. Around half a million Egyptians are currently working in Kuwait, most of them are males.
a) Discuss and illustrate graphically the impact of this program of Kuwaitization, if successfully implemented, on the labour market outcomes in Egypt?
b) What are the suggested policies that should be implemented by the government to respond to this labour market challenge?
Suppose that education is the only factor that affects productivity and that an additional year of education raises wages by 2%. Suppose in 2011 gender wage gap was 13%, and the average man had 15 years of education while the average women had 14 years of schooling.
a) Using the wage gap decomposition technique, calculate how much of the 13% wage differential is due to discrimination?
b) Now suppose in 2021 the gender wage gap is 10%, but the average woman’s education level is increased to 17 year and the average man’s education increases to16 years. (Assume that the return to education stays same at 2%),
Was there a decrease or an increase in wage discrimination in the decade? Why?
Economics
Slade and Meredith had each been earning $600 per week before losing their jobs at Nardel Solutions. Slade and Meredith live in states with replacement ratios of
1:3 (i.e., 33.33%), but Meredith's state caps unemployment compensation at $100 per week. The table below represents their marginal benefit and marginal cost of
search assuming no unemployment compensation.
Reservation Wage
Marginal Benefit
($/week)
Marginal Cost
100
700
500
150
600
450
200
500
400
250
400
350
300
300
300
350
200
250
400
100
200
With unemployment compensation, what is Slade's optimal reservation wage?
O $600 per week
O $300 per week
O $250 per week
O $500 per week
Chapter 12 Solutions
LABOR ECONOMICS (LL+ACCESS)
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Similar questions
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