Talk:Labour economics

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This article is a former featured article. Please see its original nomination page (for older articles, check the nomination archive) and why it was removed.

Labour economics appeared on Wikipedia's Main Page as Today's featured article on April 15, 2004.

In writing/editing this article I have tried to present the basic concepts of LE to both non-economists and undergrad economics students. There may be one or two places near the end of the article that the non-economist will have difficulty with, and there will be some places near the beginning that the economics undergrad will find simplistic, but I hope I've acheived a reasonable balance.

This article just skims the surface of LE. I have deliberately omitted such LE concepts as:

• labour markets and fiscal policy
• labour markets and general equilibrium
• aggregate supply derivation
• employment and inflation
• minimum wage laws
• human capital theory
• unions and collective bargaining
• discrimination
• unemployment insurance
• income tax
• payroll tax

I think all of these are better handled as separate articles. Firstly, because they are not central to LE fundamentals, and secondly the article is already 9 computer screens long (which is 3 screens longer than my usual self imposed limit). mydogategodshat 23:59, 5 Mar 2004 (UTC)

I added a brief section on social networks. I don't actually know much about the subject, but it's an important critique because it questions the basic assumptions of using market-based analysis of employment. I might be biased here since I've never held a job I didn't hear about through personal connections, but it seems important to me. Isomorphic 07:46, 9 Mar 2004 (UTC)

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This is a very good article on labour economics. I like the split between macro and micro economics too, it is organized nicely. Plus there is room to add the classical and Marxist views of labour too since its categorized in that fashion also.

One thing could be added to the criticisms part and is the neglected role of unpaid labour. Even though labour is unpaid it still can play an important in society, like child raising, but is often neglected in many economic models. Usually it is left out since it is difficult to incorporate it (usually because it is difficult to measure unpaid work), or the best method of incorporating it is disagreed upon. There are a few problems with not including the unpaid labour variable, or any significant variable, in a model. One is that the model’s conclusions might be biased, recommendations cannot be maid on the basis of promoting the good from unpaid labour since it is ignored.

Even though I am not necessarily a fan of Karl Marx, his views are a good contrast to neo classical - classical economics view of labour. A brief excerpt on him might be good, but if being featured on the front page is eminent then I wouldn’t worry about it in the short run. I only have partial notes on Marx / labour from my studies though since I exchanged my Marx class for a class in which the professor didn’t take attendance ;). It’s hard to find unbiased views on Marx or sites that explain his ideas in economic terms clearly.

A brief excerpt could be added on the importance of labour economics since unemployment is the macroeconomic problem that affects the public most directly and severely. You could add that full employment is a goal, i.e. normative economics, of many democracies and one role of labour economics is to try and achieve the full employment objective. That could then segway into a contrast between free market and command economies too since one benefit of command economies is constant full employment.--ShaunMacPherson 10:44, 11 Mar 2004 (UTC)

Shaun, Thanks for the insights, I have added some of your comments to the article. Feel free to add more. mydogategodshat 04:41, 12 Mar 2004 (UTC)

Contents 1 leisure normal good ? 2 labor or labour? 3 Request for references 4 Examples?

[edit] leisure normal good ?

Removed:

This presupposes that leisure is a normal good, something which is not provable: lottery winners who continue in work for their own fulfilment may provide a possible counter-example.

Lottery winners do not provide a counter example unless they work more than they did before winning the lottery. In order for leisure to to be an inferior good, if someone got more income (without a wage increase, otherwise you have the substition effect) they would want to work more. Another way to think of it would be that if say, welfare was canceled, saying leisure was inferior would imply that fewer people would now want to work. I don't think this makes sense.Jrincayc 13:23, 15 Apr 2004 (UTC)

I take the point on the lottery winner. However there is still an unstated assumption that leisure is a normal good, i.e. that the income effect reduces labour supply, or in other words if unearned income increases and hourly wage rates stay the same then an individual will reduce the number of hours worked. This might "make sense" but that does not make it true for everyone. To try another example, I could imagine a mother finding that because of her husband's income she could afford to employ a childminder and get a paid job herself to provide more variety in her life, which she might not be able to do if her husband was poorer. No doubt there are other possible examples and each might not "make sense" in itself, but the point I am trying to make is that there is an unstated assumption which should be stated. --Henrygb 15:55, 15 Apr 2004 (UTC)

I must give you points for creativity, and it took me some time to figure out the problem with your new story. There are (at least) two ways to look at child care by a parent. The first is to assume that it is leisure time (this is made implicitly by some aggragate statistics like GDP). The second is to assume that it is work (unpaid accounting cost wise, paid by the cost that it would be spent to have someone else take care of the child opportunity cost wise). In your story with parent switching to paid labour, the accounting cost of child care must be greater than the pay of the job for the mother, otherwise, the couple would have switched before the husband got the raise (since the mother was only able to switch after). Therefore, oppertunity cost wise, the mother is paying to work. Therefore, I think that she at least did not consider taking care of her children to be leisure (or, more probably, she had passed her saturation point of taking care of the childred being a good). So, I would consider that the mother considered the choice to be between two forms of work, and not between the 'leisure' of taking care of kids and the 'work' of paid labour. I do consider your example to be a good example of the problems of using the definition of leisure to be non-paid time. I don't consider it to be an example of leisure as a inferior good. Jrincayc 16:12, 18 Apr 2004 (UTC)

I do not agree that leisure normality (and therefore employment inferiority) is assumed in the article. This is an imperical question that is handled in the supply of labour diagram that shows leisure normality (employment inferiority) in part of the supply curve and leisure inferiority (employment normality) in another part of the curve. If there is an assumption here, it is that leisure can be either a normal or inferior good. mydogategodshat 16:41, 15 Apr 2004 (UTC)

I read that part of the article as saying that sometimes the income effect is bigger than the substitution effect and sometimes the other way round. I do not read it as saying that they could both be pointing in the same direction. --Henrygb 16:52, 15 Apr 2004 (UTC)

You are right. It dosnt address it specifically.

It may be possible that in the inferior case an increase in unearned income will lead to a decrease in the demand for leisure, which ,given our assumptions, will lead to an increase in the supply of labour services, but this would be a very rare occurance, in my opinion. mydogategodshat

[edit] labor or labour?

Do we use British spellings on this site? Labour vs. labor?

Both spelling systems are acceptable here. If an article's topic suggests either British or American spelling as more natural, then that spelling is favored (i.e. articles about British politicians are likely to use British spelling.) Otherwise it's a free-for-all. Isomorphic

The page doesn't include anything about different labour market structures which I think is important - ie the difference between internal labour markets where senior appointments are made internally and people tend to stay in the same firms, and occupational labour markets where people move more - I though that was an important aspect of the subject? DavidAndrew

[edit] Request for references

Hi, I am working to encourage implementation of the goals of the Wikipedia:Verifiability policy. Part of that is to make sure articles cite their sources. This is particularly important for featured articles, since they are a prominent part of Wikipedia. The Fact and Reference Check Project has more information. Thank you, and please leave me a message when you have added a few references to the article. - Taxman 19:24, Apr 21, 2005 (UTC)

[edit] Examples?

I am an undergraduate student studying economics. I check Wikipedia to scout out possible examples for my studies. Do the contributing editors consider an example of a (for example) perfectly competitive labour market?