Chapter 2 Labor Supply Whether to work and how many hours to work Labor supply in short run, static labor supply decision, In long run 2. 1 Some stylized facts about labor supply Measuring the labor force) BLS CPS The employed(e, a worker must have been at a job with pay for at least I hours, or worked at least 15 hours on a non- paid job such as the family farm the unemployed(u, a worker must either be on a temporary layoff from a job, or have no job but be actively looking for work in the 4-week period prior to the reference week), out of the labor force the population(p)
6 Chapter 2 Labor Supply Whether to work and how many hours to work Labor supply in short run, static labor supply decision, in long run 2.1 Some stylized facts about labor supply • Measuring the labor force(LF): BLS CPS • The employed(E, a worker must have been at a job with pay for at least 1 hours, or worked at least 15 hours on a non-paid job such as the family farm ), the unemployed(U, a worker must either be on a temporary layoff from a job, or have no job but be actively looking for work in the 4-week period prior to the reference week) , out of the labor force, the population(P)
LF=E+U Labor force participation rate=LF/P Unemployment rate=U/LF The official unemployment rate understated the real condition of unemployment. Discouraged workers, hidden unemployed Labor force participation rate, Hours of work in the u.s The participation rate of men declined from nearly 90 percent in 1900 to 76 percent by 1990 An ever-larger fraction of men choose to retire earlier
7 LF=E+U, Labor force participation rate=LF/P Unemployment rate=U/LF The official unemployment rate understated the real condition of unemployment. Discouraged workers, hidden unemployed. Labor force participation rate, Hours of work in the U.S. The participation rate of men declined from nearly 90 percent in 1900 to 76 percent by 1990. An ever-larger fraction of men choose to retire earlier
The huge increase in the labor force participation rate of women a sizable decline in average hours of work per week prior to 1940
8 • The huge increase in the labor force participation rate of women. • A sizable decline in average hours of work per week prior to 1940
年劳动时间(小时)的国际比较 日本 美国 西德 国 法国 975 1678 1830 1893 2l68 1989 2159 1638 1989 l646 资料来源:[曰]永山武夫:《劳动经济——日本的经营与劳动问题》,第107页
9 年劳动时间（小时）的国际比较 年份 日本 美国 西德 英国 法国 1975 2043 1881 1678 1923 1830 1980 2162 1893 1985 2168 1929 1659 1952 1643 1989 2159 1957 1638 1989 1646 资料来源：[日]永山武夫：《劳动经济——日本的经营与劳动问题》，第107页
2.2 The worker's preferences and budget constraints Utility function: U=U(C, L) C, consumption of goods. L, consumption of leisure. U=CL Indifference curve Marginal utility Marginal rate of substitution in consumption Time constraints T=L+h L: leisure time. h: work time Budget constraint: C=wh+V V: non-labor income C=(WT+V)-wL budget line the boundary of the workers opportunity set Slope -w
10 2.2 The worker’s preferences and budget constraints Utility function: U=U(C, L) C, consumption of goods. L, consumption of leisure. U=C*L Indifference curve Marginal utility Marginal rate of substitution in consumption Time constraints: T=L+h L: leisure time; h: work time Budget constraint: C=wh+V V: non-labor income C=(wT+V)-wL budget line the boundary of the worker’s opportunity set Slope -w