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4.3 Exercises

Exercise 1: Tight labour markets

Read “Where have all America’s workers gone?” The Economist, 2023.

  1. What are the characteristics of a tight labour market? Does it mean the unemployment rate is zero?
  2. What were the explanations for the tight labour market? How did each factor affect the unemployment rate and the labour force participation rate in the economy?

Exercise 2: Low unemployment

Read “Why American unemployment needs to rise,” The Economist, 2022.

  1. Did the unemployment rate go to zero when so many vacancies were unfilled?
  2. What was observed in the labour market when unemployment rate became much lower than its usual average? What was the impact on wage? On productivity?
  3. What could potentially alleviate the tightness in the labour market?

 

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ECON 104 Copyright © 2024 by Lijun Zhang is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License, except where otherwise noted.

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