Mountain View College Strength of the Labor Market Discussion
First, how can we “measure” whether our labor market is strong? In
your answer, please put emphasis on the unemployment rate, the labor
force participation rate, underemployment, etc. That said, according to
the text, we should get paid our “marginal revenue product” (MRP) –
what does this depend on? How can we use what we know about the MRP to
explain why wages differ from one job to the next in our economy? What
are some variables that are related to the MRP…? In other words, the
MRP is a bit too general, so if we were to examine earnings related to
other variables, what would they be?
