17 Jul What needs to be true about the relative size of these shifts if workers in this labor market are to earn higher wages?
- Two events are occurring simultaneously in the labor market for laborers who produce sports apparel. First, the government’s campaign to increase the activity rate among its citizens is proving successful, and more people are going to the gym on a regular basis. Second, the sports apparel industry is known for its relatively high pay and good benefits, which are attractive to workers.
a. Graph the effect of each shift separately. Label the original equilibrium wage and quantity W1 and L1, respectively.
b. What needs to be true about the relative size of these shifts if workers in this labor market are to earn higher wages?
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