Labor Economics Summer 2022 Name: Henrique Lin Yi

Assignment 2 (50 points)

Read each question carefully and answer in the space provided. Please highlight your answers or use a
colored font. Submit your assignment as a Word document attachment through NW Online. Be sure to double
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1.Define the term time-intensive commodity. Give an example of a time-intensive commodity in your life.

For low-income people, the relative value of time is low, so the price of time-intensive commodity consumption is
relatively lower than the price of good-intensive commodity consumption, thus the income elasticity of time-
intensive commodity consumption will be higher than that of good-intensive commodity consumption. For
example, sleeping and watching TV shows are parts of time-intensive commodity.

2. Define the term good-intensive commodity. Give an example of a good-intensive commodity in your life.

For high-income people, because time has a higher opportunity cost, the price of all consumption will also be
higher (which also means that the difference in real income is less than the difference in monetary income ), and
time-intensive commodity consumption is more If so, it will tend to good-intensive commodity consumption and
deviate from time-intensive commodity consumption so that the income elasticity of good-intensive commodity
consumption is higher than that of time-intensive commodity consumption. For example, going to video arcades to
play games.

3. Use the BLS website (www.bls.gov) and the latest BLS news release
(https://www.bls.gov/news.release/pdf/empsit.pdf) to find the following U.S. information for the most recent
date available:
a) Unemployment rate
3.6 percent

b) Number of people unemployed

5.9 million

c) Number of people in the (civilian) labor force

164,023

d) Employment-population ratio
59.9 percent

e) Labor force participation rate

62.2 percent

f) Number of discouraged workers

364,000

4. U.S. female labor force participation rates have increased significantly since the 1950s. List the 7 primary
reasons for the rapid increase in women’s labor force participation.
1.New technologies such as electrical appliances reduced the time needed to perform household chores,

2. Female labor force participation rate rebounded mainly due to the women's liberation movement. The National
Organization for Women (NOW) was founded in 1966 to fight for women's employment and other issues and to
encourage women to fully participate in the mainstream of American society.

3. Advances in birth control technology

4. Employment opportunities in the service sector increased.

5. U.S. gender pay gap narrows.

6. Poverty among women makes them more in need of work

7. U.S. women’s education levels have improved, which can help increase women’s chances of entering the labor
force.

5. Discuss three factors that you think affect how many hours people choose to work.

I feel that work environment, work intensity, and pay percentages influence the hours people choose to work. A
bad work environment can affect people's interest in work. Too much work can lead to aversion to work. Too little
wages can make people feel like they're not getting what they deserve.

6. Discuss the effect the Covid-19 pandemic has had on the U.S. labor force participation rate.
The groups with the largest decline in the labor force participation rate are mainly the elderly, women with
children, minorities, and those with low education. Older people are choosing to retire early because they are at
higher risk of contracting the new coronavirus. Women are forced to give up work to care for their children
because schools and daycares are closed. Minorities and low-educated people are hit, a phenomenon that has
occurred in past recessions. In addition, the US government's employment assistance measures will also reduce
the willingness of workers to find employment. The U.S. preference for generous handouts to the unemployed may
lead to higher search and match costs for the U.S. labor market during the recovery phase. Also during the
epidemic, many workers chose to leave the labor market due to social isolation and other reasons, and the labor
force participation rate declined.

7. The basic human capital model can be used to analyze the decision to invest in a college education by comparing
the benefits and costs of college.
a) What are the expected benefits of college?
Accumulate your own human capital. From an economic point of view, this behavior is conducive to the
optimal allocation of economic resources. From the perspective of economics, the competition of going to
university is the supply competition of the labor market. Although the cost of going to college is very high,
individuals and families are willing to pay for it to have a good job in the future.

b) What are the direct costs of college?

Tuition and fees.

c) What is the indirect (opportunity) cost of college?

Books and supplies, room and board, transportation, insurance, a small entertainment allowance, and other
personal expenses.

8. Many firms invest in on-the-job training.

a) What is on-the-job training?
Training that a person is given while doing a job and getting paid.

b) What are the benefits of on-the job training to the firm?

On-the-job training is a new driving force for enterprise development. The value of talent lies in a positive
attitude, excellent skills and broad knowledge. Enterprises need to survive and develop, and they must
improve the quality of employees through on-the-job training to ensure that the enterprise is motivated.
c) What are the costs of on-the job training to the firm?
Training cost. There are also hidden costs such as travel and administrative costs.