Transcript ECONOMICS
ECONOMICS Johnson Hsu Economics of work and leisure 1. Nature of work and leisure and trends in employment and earnings 2. Market Structures and competitive behavior in leisure markets 3. Labour demand, supply and wage determination 4. Market failure and the role of the government and union in the labour market Definition- Economics is the social science that studies economic activity to gain an understanding of the processes that govern the production, distribution and consumption of goods and services in an exchange economy Microeconomics examines the behavior of basic elements in the economy, including individual agents and markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyzes the entire economy (meaning aggregated production, consumption, savings, and investment) and issues affecting it, including unemployment of resources (labor, capital, and land), inflation, economic growth, and the public policies that address these issues (monetary, fiscal, and other policies). Macroeconomics Other broad distinctions within economics include those between positive economics, describing "what is," and normative economics, advocating "what ought to be"; between economic theory and applied economics; between rational and behavioral economics; Macroeconomics and between mainstream economics (more "orthodox" and dealing with the "rationality-individualismequilibrium nexus") and heterodox economics (more "radical" and dealing with the "institutions-historysocial structure nexus"). Work and leisure are closely concerned. What is main reasons people work for? Ans: To earn money The Structure of earnings are defined as wages, plus overtime pay, bonuses and commission. Earnings change as a result of a change in wage rates, bonuses or commission paid. The Structure of earnings On an annual basis, earnings have risen steadily in recent years. Rises, levels and composition of earnings vary between industries and occupations. Earnings in the hotel and restaurant industry were lowest. Why December to April show the largest increase in earnings? Ans: these are the months in which bonus payments are highest. Employment The structure of employment has changed in recent years and continues to change. The labour force includes both the employed and the unemployed. The labour force would be larger if those who were economically inactive were a part of it. From 1978 to 2005, Why the manufacturing decline nearly 4 million jobs? Ans: Because there was a significant rise in financing and business services. Economically inactive working age people who are neither in employment, nor unemployed, and so are not part of the labour force. In the UK, while the economic activity of women has risen, that of men has fallen. Labour force participation rate The proportion of working age people who are economically active Why a worker may no longer be employed in the same job? Ans: This was resulted from Job Separation. A worker may voluntarily leave a job to enter higher education or to be a homemaker. What is the interesting feature of job separations in the UK? Ans: One is that younger workers experience more job separation than older ones. Another is that women’s job separations tend to be voluntary, whereas men’s job separation are more likely to be involuntary. Discouraged workers or the 'work shy', are people who have given up seeking employment since they believe they will not be able to find work. The government is attempting to increase the employment rate, setting itself the target of 80% of working age people in work. Recent trends in employment Workers in the public sector differ from those in the private sector in a number of ways. Part-time employment has also grown in absolute terms. The number of self-employed workers in increasing. (Small Office Home Office) Employment rate the proportion of working age people who are in work. In 2005, the UK had an employment rate of 74.7% (males 79.1%, females 70%), compared with an EU employment rate of 64% (males 71.5%, females 56.6%). Part-time workers People working less than 30 hours a week. Why part-time employment is increasing during 1996 to 2006? Ans: Because the unavailability of a full-time job has become less important in the last decade. Teleworking Working using a telephone and a computer at home, in an internet café, or a train or plane Temporary work Casual work, seasonal work, working for employment agencies, fixed-period contract work Why people undertake temporary work? Ans: because they are unable to find a permanent job. Homeworking Working either at home or in different places away from the central office, production or distribution facilities, using the home as a base Advantages for homeworkers: More control over when they work, which helps with family commitment and may reduce stress. Employers benefit from lower office costs. Access to a greater pool of workers Lower rates of sickness and highly productiity. Disadvantages of homeworker Workers may feel more isolated and may receive less training. Recent trends in earnings The earnings workers receive are influenced by a number of factors: educational qualifications Skills Which area they work in The industry they work in Their age Gender Occupation Age Age population in EU Italy Germany Ireland Slovakie What is the advantage of the change job less frequently from older workers Ans: Reduce firms’ turnover costs, including recruitment and initial training costs. What are the reasons women are participating in the labour force more? Ans: Increase opportunity for women Increase pay changing social attitude Increased expectations of higher living standare Occupation segregation The domination of an occupation by one gender Why the pattern of employment of women and men is different? Ans: The difference in the pattern of employment is sometimes referred to as occupational segregation. Why, on average, women are less well paid than men? Ans: In order to find jobs that allows them to spend time with their children, one third of all corporate managers have to switch to lower-skill job. Almost half give up their managerial responsibilities and become assistant etc., (occupational downgrading) Primary sector The first stage of production, including industries such as agriculture, fishing, forestry and mining, involved I the extraction and collection of raw materials. Secondary sector The second stage of production, which involves the processing of raw materials into semi-finished ad finished goods. It includes manufacturing construction Tertiary sector The third stage of production, which covers industries production services including education, financial services, health care and tourism What are the reasons of the relatively poor performance of UK against USA and some EU countries? Ans: Lower level of capital per worker Educational shortcomings Insufficient innovation Inefficient transport system Wage wedge The gap between what employers pay for labour and what receive in disposable income Outsourcing Subcontracting part of the production process to another firm Offshoring Transferring part of the process to another country. The production may be outsourced or may be undertaken by the firm but in another country Leisure People’s time can be divided into three main categories work/education Maintenance time leisure Forms of leisure Home-based activities: such as reading, accessing Facebook and gardening Out-of-home activities: such as eating out, visiting a club and going to the cinema. The supply of leisure The private sector The public sector The voluntary sector Factors influencing demand for a particular leisure activity The price of the activity The price of complementary goods and services The price substitutes Tastes Age composition Gender composition Advertising Major events Exchange rate Changes in the leisure market A rise in the proportion of home-based leisure activities. A rise in gambling. A rise in expenditure on leisure activities An increase in the influence of the USA The growth of tourism An increase in disposable income A reduction in working hours A fall in the real cost of travel Early retirement People living longer A reduction in time spent on domestic tasks Improved transport Increased advertising Increased awareness of the benefits The effects of tourism Income and employment The balance of payment Culture Enviornment Tourism income multiplier The extent to which a change in income from tourism causes GDP to change Monopoly A single seller Market concentration ratio The percentage share of the market of a given number of firms Employment and unemployment rates by age group, 1992~2012 How much do you earn each year? Unemployment Rate By Gender The gender pay gap Comparison of minimum wages across Asia and the United States* EURO AREA:UNIT LABOUR COSTS Economies of Scale Diseconomies of scale Relationship between the SRAC and the LRAC curves