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15 Cards in this Set
- Front
- Back
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Marginal Product
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The additional output a firm gets by employing one additional unit of labour.
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Value of Marginal Product of Labour
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The dollar value of the additional output a firm gets by employing one additional unit of labour.
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Observationally Equivalent Workers |
Workers of the same type: that is, with the same generally known personal characteristics (age, education, gender, work experience, race, ethnicity, etc.). |
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Monospony
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A market with only a single buyer.
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Marginal Labour Cost
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The amount by which a firm's total wage bill goes up if it hires an extra worker. |
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Human Capital Theory
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A theory of pay determination stating that a worker's wage will be proportional to his or her stock of human capital.
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Human Capital
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The skills produced by education, training, and experience that affect a worker's marginal product.
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Present Value
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The current value of an amount paid or received in the future; preferring current consumption means a payment or receipt that occurs in the future will be discounted to a present value. |
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Labour Union
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A group of workers who bargain collectively with employers for better wages and working conditions.
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Winner-take-all Labour Market
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A market in which small differences in human capital translate into large differences in pay.
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Compensating Wage Differential
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A difference in the wage rate, negative or positive, that reflects the attractiveness of a job's working conditions.
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Employer Discrimination
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An arbitrary preference by the employer for one group of workers over another.
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Statistical Discrimination |
The practice of making judgments about the quality of people, goods, or services based on the characteristics of the groups to which they belong.
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Discount Factor
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A coefficient, D, used to discount a payment or receipt that occurs in the future to a present value, can be defined algebraically as: D = 1/[(1+r)^t] Where r = annual interest rate, and T = number of years that will elapse before the payment is received. |
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Present Value (PV)
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The amount that would have to be deposited today at an annual interest rate, r, to generate a balance of M after T years: PV=M/[(1+r)^T]=DM |
