final exam Flashcards
(26 cards)
marginal physical product ((MPP)) of labor
The change in output resulting from the addition of one more worker. The MPP of the worker equals the change in total output accounted for by hiring the worker, holding all other factors of production constant.
Marginal revenue product ((MRP))
The marginal physical product (MPP) times marginal revenue (MR). The MRP gives the additional revenue obtained from a one-unit change in labor input.
Marginal factor cost (MFC)
The cost of using and additional unit of an input. For example, if a firm can hire all the workers it wants at the going wage rate, the marginal factor cost of labor is the wage rate.
derived demand
Input factor demand derived from demand for the final product being produced.
outsourcing
A firm’s employment of labor outside the country in which the firm is located.
labor unions
worker organizations that seek to secure economic improvements for their members; they also seek to improve the safety, health, and other benefits (such as job security) of their members.
craft unions
labor unions composed of workers who engage in a particular trade or skill, such as baking , carpentry, or plumbing.
collective bargaining
negotiation between the management of a company or of a group of companies and the management of a union or a group of unions for the purpose of reaching a mutually agreeable contract that sets wages, fringe benefits, and working conditions for all employees in all the unions involved.
industrial unions
Labor unions that consist of workers from a particular industry, such as automobile manufacturing or steel manufacturing.
right-to-work laws
Laws that make it illegal to require union membership as a condition of continuing employment in a particular firm.
closed shop
A business enterprise in which employees must belong to the union before they can be hired and must remain in the union after they are hired.
union shop
A business enterprise that may hire nonunion members, conditional on their joining the union by some specified date after employment begins.
jurisdictional dispute
A disagreement involving two or more unions over which should have control of a particular jurisdiction, such as particular craft or skill or a particular firm or industry.
sypathy strike
A work stoppage by a union in sympathy with another union’s strike or cause.
secondary boycott
A refusal to deal with companies or purchase products sold by companies that are dealing with a company being struck.
strikebreakers
Temporary or permanent workers hired by a company to replace union members who are striking.
featherbedding
Any practice that forces employers to use more labor than they would otherwise or to use existing labor in an inefficient manner.
monopsonist
The only buyer in a market.
monopsonistic exploitation
Paying a price for the variable input that is less than its marginal revenue product; the difference between marginal revenue product and the wage rate.
bilateral monopoly
A market structure consisting of a monopolist and a monopsonist.
distribution of income
The way income is allocated among the population.
lorenz curve
A geometric representation of the distribution of income. A Lorenz curve that is perfectly straight represents complete income equality. The more bowed a Lorenz curve, the more unequally income is distributed.
income in kind
Income received in the form of goods and services, such as Housing or medical care; to be contrasted with money income, which is simply income in dollars, or general purchasing power, that can be used to buy any goods and services.
age-earnings cycle
The regular earnings profile of an individual throughout his or her lifetime. The age-earnings cycle usually starts with a low income, builds gradually to a peak at around age 50, and then gradually curves down until it approaches zero at retirement.
