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Economics 202 ch 25
Principles of Economics ch 25
| Question | Answer |
|---|---|
| Labor Union | An organization of workers. |
| What are the types of labor unions? | Craft union, industrial union, and public employee union. |
| Craft Union | A union made up of workers who practice the same craft, such as actors, carpenters, electricians, plumbers, airline pilots, etc. |
| Industrial Union | A union made up of workers in the same industry, such as autoworkers, teamsters, steelworkers, etc. |
| Public Employee Union | A union made up of workers employed by the government, such as school teachers, municipal employees, firefighters, etc. |
| Demand Curve for a Union | Faces a downward sloping demand curve for its labor. |
| If a union negotiates a higher wage rate: | This will generally mean fewer union members employed. |
| A labor union has market power or: | The ability to affect the market wage rate. |
| Given the trade-off between wages and employment, all union will tend to have certain predictable goals: | Reduce the elasticity of demand for union labor, increase the demand for union labor, and decrease the supply of union labor. |
| The elasticity of demand for union labor can be reduced by: | Reducing the availability of substitute factors and reducing the availability of substitute products. |
| The demand for union labor can be increased by: | Increasing product demand, increasing the MPP of union workers, and increasing the prices of substitute factors. |
| Closed Shop | Requires union membership as a condition for employment. |
| Union Shop | Requires employees to join the union within a specified time. |
| The Taft-Hartley Act (1947) | Prohibited closed shop agreements in all states and gave the individual states the power to pass right-to-work laws. |
| Right-to-Work Laws | Prohibit union shops. |
| Open Shops | Workers may join the union or may choose to not join the union. |
| Workers who choose to not join the union: | Are still covered by the collective bargaining agreement. |
| Collective Bargaining | Where a union bargains with management on behalf of the workers. |
| The most important bargaining tool available to a union is: | The threat of a strike. |
| Monopsony | A lone buyer in a factor market. (Example: The only employer in a small town.) |
| As the lone buyer in a factor market, a monopsony has: | Market power and faces an upward sloping labor supply curve. |
| A monopsony will attempt to employ the profit-maximizing quantity of labor. Thus, a monopsony will employ workers where: | MRP = MFC |
| A monopsony will employ a lesser quantity of labor at a lower wage rate compared to: | A perfectly competitive employer. |
| A union negotiating with a monopsony may be able to obtain: | Both a higher wage and a greater quantity |
| If a union successfully negotiates a higher wage for its members, fewer workers will be employed in the union market. This will mean: | An increase in the supply of labor in the nonunion market, decreasing the wages of nonunion employees. |
| The traditional view holds that unions hurt productivity due to: | Strikes, unnecessary staffing requirements (featherbedding), and keeping willing employers and employees apart. |
| Featherbedding | Unnecessary staffing requirements under a union. |
| A view that hold unions increase productivity by: | Providing union workers with a collective voice and attracting high quality workers. |
Created by:
dengler
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