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26 Cards in this Set
- Front
- Back
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What is it called when real and potential GDP are =?
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Natural enmployment
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frictional unemployment
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when workers move from one job to another
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structural unemployment
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occurs as a result in technology or in the way the economy is structured
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seasonal unemployment
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fluctuations in unemployment due to regular occurances such as holidays or certain schedules
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cyclical unemployment
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results from recessions and economic downfalls
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discouraged worker
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person who wants a job, but has stopped looking for work for job-related reasons
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Part-time worker
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works 1-39 hours a week
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Aggregate Hours
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total number of hours worked by all workers in an economy over a period of time.
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Creative destruction
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refers to the loss of whole business firms as well as jobs when new ideas and techniques replace the old
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Real Wage
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wage/price of labor adjusted for inflation
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Insider
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has some control or infulence over wage and hiring policy
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Outsider
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someone not working for a particular firm, making it difficult for them to get a job even though they are willing to work for lower wage
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What two types of unemployment cause the nat. unemployment rate?
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frictional and structural
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What % of the labor force works part-time?
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11%
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What are the 4 ways people are counted as unemployed?
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Job leavers, job losers, new entrants, re-entrants
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Creative destruction accounts for what percent of lost jobs?
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5%
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What percent of jobs lost comes from job leavers?
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less than 25%
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What group is most likely to experience the highest rate of unemployment?
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young minority males
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Besides wanting to increase efficiency, why else would a firm pay the efficiency wage?
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Turnover is lower and so are training costs
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The best example of the insider vs. outsider explanation is what group?
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labor unions
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Which explanation argues that laws requiring wages be kept at a minimum amount?
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minimum wage explanation
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What two policies could cause the natural unemployment rate to decline?
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lower minimum wage and lower unemployment compensation
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What might help unemployment from job search to decline?
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improving communications about labor market
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Stochastic Equilibrium is the result of what?
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labor markets in perpetual motion
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What is the current unemployment rate?
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5%
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What happens to the unemployment rate when people drop out of the labor force b/c of a recession?
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it decreases
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