To work or not to work... that is the question: A classroom experiment on how the labour market operates
Arlene Garces-Ozanne and
Phyll Esplin (pesplin@business.otago.ac.nz)
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Phyll Esplin: Department of Economics, University of Otago
No 802, Working Papers from University of Otago, Department of Economics
Abstract:
This paper presents a simple classroom experiment that helps students make economic decisions about participation in the labour market. The students are designated as workers and are given information about their skill endowments, marginal productivities and opportunity costs. The lecturer, who is the designated sole employer in this experiment, offers appropriate wage rates to the workers, knowing the workersÕ marginal productivities and the price at which output can be sold. The experiment is run for a number of periods, each period representing different conditions in the labour market, e.g., a minimum wage law is mandated by the government. During each period, the students (workers) must decide whether or not to offer their labour services based on the information they have at hand.
Keywords: Classroom experiment; labour market (search for similar items in EconPapers)
JEL-codes: A20 A22 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2008-01, Revised 2008-01
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Persistent link: https://EconPapers.repec.org/RePEc:otg:wpaper:0802
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