AP Economics – 12/18/18
I. Bellwork
Is Slow Wage Growth a Sign of Monopsony Power?
- -Explain why some economists believe that slow wage growth indicates widespread monopsony power by employers?
- -What other factors could be the cause of slow wage growth?
- -If the slow wage growth is a result of monopsony power, is there a role for the government to address this?
II. Objectives
- Explain the labor market applications of the marginal productivity theory of income distribution
- Identify and describe sources of wage disparities and the role of discrimination through examination of the text and completion of an outline
III. Discussion Pages 720-726
A. The Marginal Productivity Theory of Income Distribution: the division of income among the economy’s factors of production is determined by each factor’s marginal productivity at the market equilibrium
- Marginal Productivity and Wage Inequality
- Market Power
- Efficiency Wages
- Discrimination
B, Is the Marginal Productivity Theory of Income Distribution Really True?
- Does Marginal Productivity Theory Work?
IV. Claswork on iLearn
- Worksheet 73.1: Efficiency Wages on iLearn
- For each number in the outline above explain the concept and provide a real life example
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