ABSTRACT
This chapter deals with the supply of and demand for labor. You will learn why the supply curve for paid labor is generally depicted as sloping upward, and why the labor supply curve for an individual worker may bend backward. Also included are topics such as market power in labor markets, the notion of compensating wage differentials, and labor market discrimination. The chapter highlights the ways in which historical and social factors can influence wage patterns over time. The other labor topics presented in the chapter include labor market participation rates, labor market flexibility, immigration, cooperatives, work-life balance, and inequality.
