Term
|
Definition
| Occurs when the demand for a factor of production arises from the demand for the output it produces. |
|
|
Term
| Theory of marginal productivity |
|
Definition
| Key theory underpinning the demand for labour. |
|
|
Term
| Marginal revenue product (MRP) |
|
Definition
| The value of the physical addition to output arising from hiring one extra unit of a factor of production. |
|
|
Term
| Marginal product of labour |
|
Definition
| The change in total output arising from hiring one more worker. |
|
|
Term
| Elasticity of demand for labour |
|
Definition
| The responsiveness of quantity demanded of labour to a change in the wage rate. |
|
|
Term
|
Definition
| The percentage of the population who are either not in work or not seeking it. |
|
|
Term
| Participation rate/activity rate |
|
Definition
| The percentage of the population of working age currently in work or actively seeking work. |
|
|
Term
|
Definition
| The financial rewards to a particular occupation, for example wage, commision or bonus. |
|
|
Term
|
Definition
| The non-financial rewards to a particular occupation, for example holidays, leisure time and convenience. |
|
|
Term
|
Definition
| The overall rewards to a particular occupation, taking into account both monetary and non-monetary factors. |
|
|
Term
|
Definition
| The number of people of working age who do not currently have a job but are actively seeking work at existing wage rates. |
|
|
Term
| Elasticity of supply of labour |
|
Definition
| The responsiveness of quantity of labour supplied to a change in wage rate. |
|
|
Term
| Backward-bending supply curve for labour |
|
Definition
| The individual labour supply curve is thought to be this shape because it is assumed workers will prefer to work fewer hours as their income increases above a certain level. |
|
|
Term
| Income effect (of a wage increase) |
|
Definition
| Depending upon an individual's target level of income, he or she can work fewer hours for the same overall pay. |
|
|
Term
| Substitution effect (of a wage increase) |
|
Definition
| Individuals will tend to choose to work more hours, as the opportunity cost of leisure increases. |
|
|
