ECON 3240 Lecture 1: UNIONS
15 Dec 2015
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Document Summary
They believed that unions have artificially increased the wage rate above competitive market levels. Unions have been criticized for three reasons: union reduction of available labour creates economic, unions increase wages by decreasing employment. Increase in wages increase the cost of output commodity for consumers and decreases profits for the firms. Inefficiency by the amount of triangle space below demand and above supply b/w competitive & unionized quantities of labour: union reduction of labour in the unionized industry increases the supply of labour in the non-unionized industries. - thereby reducing the wage below the wage that would prevail if neither industries were unionized. In a competitive firm price is given regardless of the output therefore total revenue is price. In a monopolist firm the mr is not constant because the price changes in the market for every change in output. Total revenue increases with and increase in output up to the. Midpoint of a linear demand function because elasticity is.
