平狄克微观经济学第六版第十四章课后答案解析.docx

平狄克微观经济学第六版第十四章课后答案解析.docx

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平狄克微观经济学第六版第十四章课后答案解析

CHAPTER14

MARKETSFORFACTORINPUTS

TEACHINGNOTES

Thefollowingtwochaptersexaminethemarketsforlaborandcapital.Althoughthediscussioninthischapterisgeneral,mostoftheexamplesrefertolaborastheonlyvariableinputtoproduction,withtheexceptionofExample14.1,whichdiscusses“TheDemandforJetFuel”byairlines.Labordemandandsupplyarediscussedinthefirstsection,andthecompetitivefactormarketequilibriumandeconomicrentarediscussedinthesecondsection.Section14.3exploresthefactormarketstructureforthecasewherethebuyerhasmonopsonypower,andsection14.4exploresthecaseofmonopolypoweronthepartofthesellerofthefactor.

AnunderstandingofthischapterreliesonconceptsfromChapters4through8and10.IfyouhavejustcoveredChapters11-13,youmightbeginbyreviewingmarginalproduct,marginalrevenue,andcostminimization.Youshouldthendiscussmarginalrevenueproductandtheprofit-maximizingconditionMRPL=w.ExplainwhyweareonlyinterestedintheportionoftheMPcurvebelowtheaverageproductcurve（thedownward-slopingportion）.Thederivationofthefirm’sdemandcurveforlaborisstraightforwardwhenlaboristheonlyfactor,butbecomesmorecomplicatedwhenthereareseveralvariableinputs.Inparticular,youmightexplainwhytheMRPLcurveshiftsasthefirmsubstitutesoneinputforanotherinproductioninresponsetoapricechangebynotingthattheMRPLcurveisdrawnforafixedleveloftheothervariableinput.

Whenpresentingthemarketlabordemandcurve,explainthatsincetheinputpriceschangeasmoreinputsaredemanded,themarketdemandcurveisnotsimplythesummationofindividualdemandcurves.Youcanextendthepresentationofpriceelasticityofinputdemand（seeExample14.1）bydiscussingtheconditionsleadingtopricesensitivity.Elasticityisgreater

（1）whentheelasticityofdemandfortheproductishigher,

（2）whenitiseasytosubstituteoneinputforanother,and（3）whentheelasticityofsupplyishigherforotherinputs.Elasticityofsupply,whichwasdiscussedinChapter2,isreintroducedinExample14.2.Youshouldalsodistinguishbetweenshort-runandlong-runelasticity（seeFigure14.6）.

Ifyouhavealreadycoveredsubstitutionandincomeeffects,thestudentswillbereadyforthederivationofthebackward-bendingsupplycurveforlabor.AlthoughFigure14.9isastraightforwardapplicationofthesetools,studentsareoftenconfusedbytheplottingofincomeagainstleisure.Pointoutthatthisisjustanothertypeofutilitymaximizationproblemwherethetwogoodsareleisureandincome.Incomecanbethoughtofastheconsumptionofgoodsotherthanleisure,inthatmoreincomebuysmoregoods.Youcanalsoimplicitlyassumethatthepriceofothergoodsis$1andthepriceofleisureisthewage.Thesupplyoflaborcurveisderivedbychangingthewageandfindingthenewlevelofhoursworked.Anindividual’ssupplycurveoflaborisbackwardbendingonlywhentheincomeeffectdominatesthesubstitutioneffectandleisureisanormalgood.ShowtypicalsupplycurvesforeachgroupinTable14.2.Foranexperimentalstudyofthelabor-leisuretrade-offseeBattalio,Green,andKagel,“Income-LeisureTradeoffofAnimalWorkers,”AmericanEconomicReview（September1981）.

Section14.2bringstogetherlabordemandandsupplyforbothcompetitiveandmonopolisticproductmarkets.AlthougheconomicrentwaspresentedinChapter8,itisreintroducedwithmoredetailhere.InSection14.3,carefullyexplainwhythemarginalexpenditurecurveisabovetheaverageexpenditurecurveforamonopsonist（seeFigure14.14）.Youcandiscusshowamonopsonistwouldpricediscriminate,e.g.,payadifferentwageratetoeachemployee.Withperfectpricediscrimination,themarginalrevenueexpenditurecurvewouldcoincidewiththeaverageexpenditurecurve.Althoughmonopsonyexistsinsomemarkets,theexerciseofmonopsonypowerisrarebecauseoffactormobility.However,theemploymentofathletesbytheownersofprofessionalteamsprovidesagoodexample（seeExample14.4“MonopsonyPowerintheMarketforBaseballPlayers”）.Onthissametopic,seeSommersandQuinton,“PayandPerformanceinMajorLeagueBaseball:

TheCaseoftheFirstFamilyofFreeAgents,”JournalofHumanResources（Summer1982）.Section14.4discussesthecaseofunionstoexploremonopolypoweronthepartoftheselleroftheinput.

REVIEWQUESTIONS

1.Whyisafirm’sdemandforlaborcurvemoreinelasticwhenthefirmhasmonopolypowerintheoutputmarketthanwhenthefirmisproducingcompetitively?

Thefirm’sdemandcurveforlaborisdeterminedbytheincrementalrevenuefromhiringanadditionalunitoflaborknownasthemarginalrevenueproductoflabor:

MRPL=（MPL）（MR）,theadditionaloutput（“product”）thatthelastworkerproduced,timestheadditionalrevenueearnedbysellingthatoutput.Inacompetitiveindustry,themarginalrevenuecurveisperfectlyelasticandequaltoprice.Foramonopolist,marginalrevenueisdownwardsloping.Asmorelaborishiredandmoreoutputisproduced,themonopolistwillchargealowerpriceandmarginalrevenuewilldiminish.Allelsethesame,marginalrevenueproductwillbesmallerforthemonopolist.Thisimpliesthatthemarginalrevenueproductforthemonopolistismoreinelasticthanforthecompetitivefirm.

2.Whymightalaborsupplycurvebebackwardbending?

Abackward-bendingsupplycurveforlabormayoccurwhentheincomeeffectofanincreaseinthewageratedominatesthesubstitutioneffect.Laborsupplydecisionsaremadebyindividualschoosingthemostsatisfyingcombinationofworkandother（leisure）activities.Withalargerincome,theindividualcanaffordtoworkfewerhours:

theincomeeffect.Asthewagerateincreases,thevalueofleisuretime（theopportunitycostofleisure）increases,thusinducingtheindividualtoworklongerhours:

thesubstitutioneffect.Becausethetwoeffectsworkinoppositedirections,theshapeofanindividual’slaborsupplycurvedependsontheindividual’spreferencesforincome,consumption,andleisure.

3.Howisacomputercompany’sdemandforcomputerprogrammersaderiveddemand?

Acomputercompany’sdemandforinputs,includingprogrammers,dependsonhowmanycomputersitsells.Thefirm’sdemandforprogramminglabordependson（isderivedfrom）thedemanditfacesinitsmarketforcomputers.Asdemandforcomputersshifts,thedemandforprogrammersshifts.

4.Comparethehiringchoicesofamonopsonisticandacompetitiveemployerofworkers.Whichwillhiremoreworkers,andwhichwillpaythehigherwages?

Explain.

Sincethedecisiontohireanotherworkermeansthemonopsonistmustpayahigherwageforallworkers,andnotjustthelastworkerhired,itsmarginalexpenditurecurveliesabovetheinputsupplycurve（theaverageexpenditurecurve）.Themonopsonist’sprofit-maximizinginputdemand,wherethemarginalexpenditurecurveintersectsthemarginalrevenueproductcurve,willbelessthanthecompetitor’sprofit-maximizinginputchoice,wheretheaverageexpenditurecurveintersectsthedemandcurve.Themonopsonisthireslesslabor,andthewagepaidwillbelessthaninacompetitivemarket.

5.Rockmusicianssometimesearnover$1millionperyear.Canyouexplainsuchlargeincomesintermsofeconomicrent?

Economicrentisthedifferencebetweentheactualpaymenttothefactorofproductionandtheminimumamountthatthefactoriswillingtoaccept.Inthiscase,youmightassumethattherearealimitednumberoftop-qualityrockmusicianswhowillcontinuetoplayrockmusicnomatterwhattheyarepaid.Thisresultsinaperfectlyinelasticsupplycurve,orsomethingclosetoit.Giventhehighdemandforrockmusic,thewagewillbeveryhighandtherewillbealotofeconomicrent.Iftherewasalargersupplyoftop-qualityrockmusicians,oramoreelasticsupply,thentheeconomicrentwouldbesmaller.

6.Whathappenstothedemandforoneinputwhentheuseofacomplementaryinputincreases?

Ifthedemandforthecomplementaryinputincreases,thedemandforthegiveninputwillincreaseaswell.Whendemandforthecomplementaryinputincreases,thereisanincreaseinthequantityhiredandpossiblythepricepaid.BothofthesechangeswillincreasetheMRPofthegiveninput,andhencewillincreasethequantityhiredandpossiblythepricepaid.Whetherthepricesoftheinputsincreasesdependsonthedegreeofmonopsonypoweronthepartofthefirm.

7.Foramonopsonist,whatistherelationshipbetweenthesupplyofaninputandthemarginalexpenditureonit?

Thedecisiontoincreaseemploymentmeansthemonopsonistmustpayallunitsthehigherprice,andnotjustthelastunithired.Therefore,itsmarginalexpenditurecurveliesabovetheinputsupplycurve（theaverageexpenditurecurve）.Hiringmorelaborwillincreasethemarginalexpenditure,whichwillincreasetheaverageexpenditure.Iftheaverageexpenditureisincreasing,thenthemarginalexpendituremustbegreaterthantheaverageexpenditure.

8.CurrentlytheNationalFootballLeaguehasasystemfordraftingcollegeplayersbywhicheachplayerispickedbyonlyoneteam.Theplayermustsignwiththatteamornotplayintheleague.Whatwouldhappentothewagesofnewlydraftedandmoreexperiencedfootballplayersifthedraftsystemwererepealed,andallteamscouldcompeteforcollegeplayers?

TheNationalFootballLeaguedraftandreserveclause（aprimaryissueinthe1987-1988season’sstrike）createsamonopsonistcartelamongtheownersofNFLteams.Ifthedraftsystemwererepealed,competitionamongteamswouldincreasewagesoffootballplayerstothepointwherethemarginalreven