Class Notes (835,929)
Canada (509,507)
Economics (1,617)
ECON 1BB3 (535)
Lecture 12

Economics - Lecture 12-16 Notes.docx

4 Pages
Unlock Document

Bridget O' Shaughnessy

Economics – February 4 , 2013 – Lecture 12 (PowerPoint slides) Economics – February 5 , 2013 – Lecture 13 (In-class activity – hiring thing) Economics – February 11 , 2013 – Lecture 14 Is unemployment necessarily bad?  Statistics Canada divides the non-institutional adult population into three categories: 1. Employed 2. Unemployed 3. Not in the labour force  Unemployment rate = (# of unemployed/labour force) x 100  LFPR = (labour force/adult population) x 100  Employment rate = (# of employed/adult population) x 100  LFPR: labour force participation rate  People who aren’t interested in working are in adult population Do these figures reflect reality? 1. Discouraged workers  Looking for work for a while but cannot find any  Stop looking because don’t think they’ll find any  Do not actually count because do actually want a job 2. Underemployment  People working part time when they would rather work full time  Count as working so do not count as unemployed even though they want to work more than they are  People are overqualified for their job because were a doctor in their home country but not in Canada (ex.) 3. People lie  Lie to get employment insurance Why is there unemployment? Three types of unemployment: 1. Frictional unemployment  Job search: recently lost job and are looking for new one but haven’t found one yet  Sectorial shifts: some industries not needed anymore and new ones being created 2. Structural unemployment  Quantity of labour supplied > quantity of labour demanded 3. Cyclical unemployment  Recession/expension Employment Insurance (EI) (diagram) th Economics February 12 , 2013 – Lecture 15 International Comparisons  Look at post: o Overall unemployment rate for January o Youth unemployment rate for January o Unemployment rate for women and men for 25+ for January  More generous employment insurance usually means higher unemployment Would you hire a lawyer willing to work for $8 an hour? Why is there unemployment? 1) Frictional unemployment 2) Structural unemployment 3) Cyclical unemployment  Natural rate of unemployment: long run average  If actual unemployment rate > natural unemployment: in a recession  If actual unemployment rate < natural unemployment rate: in an expansion Reasons for Structural Unemployment 1. Minimum wage: economic theory  Minimum wage is a price floor  Difference between people who want to work at binding minimum wage and people who want to pay that minimum wage causes unemployment  Horizontal distance between labour supply curve and labour demand curve Minimum wage: real world  When minimum wage went up there did not seem to be a drop in employment  Use vertically sloped labour demand curve instead  Do have
More Less

Related notes for ECON 1BB3

Log In


Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.