The following graph shows the labor market in a state in the South. The legislature in this state passes strong "right-to-work" laws that make it very difficult for unions to organize workers, so the wage is always equal to the market-clearing value. Except for this difference in legislation, the two states are very similar. The initial position of the graph corresponds to the initial labor market condition in the southern state before the labor union negotiated the new, higher wage for workers in the northern state. Adjust the graph to show what happens to employment and wages in the southern state after some workers in the northern state lose their jobs and decide to move to the southern state. Labor Market in the South Supply Demand Supply Demand LABOR WAGE

The following graph shows the labor market in a state in the South. The legislature in this state passes strong "right-to-work" laws that make it very difficult for unions to organize workers, so the wage is always equal to the market-clearing value. Except for this difference in legislation, the two states are very similar. The initial position of the graph corresponds to the initial labor market condition in the southern state before the labor union negotiated the new, higher wage for workers in the northern state. Adjust the graph to show what happens to employment and wages in the southern state after some workers in the northern state lose their jobs and decide to move to the southern state. Labor Market in the South Supply Demand Supply Demand LABOR WAGE

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter16: The Markets For Labor, Capital, And Land

Section: Chapter Questions

Problem 15P

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