Scarcity, work and choice
,Lecture 1
Introduction
* Labour is work
* Labour is an input in the production of goods and services
of
* New
technologies raise the
productivity labour
La would that affect Standards ?
How
living
L would that affect free and his by individuals ?
How the time
working chosen
for most standards
countries ,
living have
increased Since But
greatly 1870 . there
are disparities in free time & income
across countries
(income
In this unit we use a model of
differences
working
individual choice to explain the in his
time
over across
genders
· ·
of in equality countries
· be
changes · across
, and if
Scarcity Choice a Scarcity : a
good is scarce it is valued and there is
of of it
aquiring
cost
an opp more
* A model of constrained choice *
-
Individuals want to consume as much as
possible BUT their consumption
-
relies
AND have as much free
-
time as
possible
on
working
free time)
sacrificing
How can we model how an individual chooses the
combination of free time and consumption that's best for them ?
↳ &
Important factors = avaliable
wage preference
(w) (n)
Eg) Karim of work will
:
Together the
wage and hrs
determine his total income (Y)
·
Karim can earn E30 hour &
-
an
wh
can work a max of 16hrs a day =
Y
* These
figures show how Karim's income
is dependant his production function (
working (similar
on hrs . to
* income increases as his of work incr
.. upward slope
w
slope :
a
slope-vertical
horizontal changea
S
slope is constant and equal the
to
wage
be at
every point ,
an incr in one hr
of
working leads to E30 incr in
income
·
How many hours a day will
he choose to work ?
,Lecture 1
Introduction
* Labour is work
* Labour is an input in the production of goods and services
of
* New
technologies raise the
productivity labour
La would that affect Standards ?
How
living
L would that affect free and his by individuals ?
How the time
working chosen
for most standards
countries ,
living have
increased Since But
greatly 1870 . there
are disparities in free time & income
across countries
(income
In this unit we use a model of
differences
working
individual choice to explain the in his
time
over across
genders
· ·
of in equality countries
· be
changes · across
, and if
Scarcity Choice a Scarcity : a
good is scarce it is valued and there is
of of it
aquiring
cost
an opp more
* A model of constrained choice *
-
Individuals want to consume as much as
possible BUT their consumption
-
relies
AND have as much free
-
time as
possible
on
working
free time)
sacrificing
How can we model how an individual chooses the
combination of free time and consumption that's best for them ?
↳ &
Important factors = avaliable
wage preference
(w) (n)
Eg) Karim of work will
:
Together the
wage and hrs
determine his total income (Y)
·
Karim can earn E30 hour &
-
an
wh
can work a max of 16hrs a day =
Y
* These
figures show how Karim's income
is dependant his production function (
working (similar
on hrs . to
* income increases as his of work incr
.. upward slope
w
slope :
a
slope-vertical
horizontal changea
S
slope is constant and equal the
to
wage
be at
every point ,
an incr in one hr
of
working leads to E30 incr in
income
·
How many hours a day will
he choose to work ?
