Economics 355
Economics of Labor
Spring 2008 9 a.m.
Instructor:
Office:
Telephone:
Office Hours:
Web Page:
D.W. Hedrick
Shaw-Smyser 424
963-2426
M & F 10:00-10:00 a.m. and T & TH 2:30-3:30 p.m. and by
appointment.
www.cwu.edu/~dhedrick/
COURSE DESCRIPTION:
This course provides an introduction to labor economics. The theoretical foundations of the
demand and supply of labor are presented and the implications of institutional considerations and
government policy on economic efficiency and equity are explored.
COURSE OBJECTIVES:
Students will develop an appreciation of the application of economic analysis to understanding
the functioning of labor markets. They will deepen their understanding of the theoretical
concepts they gained in principles of economics through an in-depth study of the behavior of
households and businesses in the labor market. Students will become familiar with publicly
available sources of labor market data and their use in understanding labor market conditions.
Knowledge of the distinctive institutional structure of labor markets in the United States will be
obtained. Students will be able to identify and understand the major theoretical and policy issues
in labor economics.
TEXTBOOK:
Required: Ehrenberg, Ronald G. and Robert S. Smith, Modern Labor Economic: Theory and
Public Policy, 9rd Edition, Addison – Wesley, c2006.
Suggested Reading:
The Wall Street Journal
The Economist
COURSE OUTLINE: (Subject to change as circumstances indicate)
Topic
Text Chapter(s)
I . Introduction to Labor Economics
The Basics of Economic Analysis
Overview of the Labor Market
1, 1A
2
II. Business Behavior and the Demand for Labor
Demand for Labor
Labor Demand Elasticities
Quasi-Fixed Costs and Labor Demand
3, 3A
4, 4A
5
II. Household Behavior and the Supply of Labor
The Decision to Work
Household Production, Family and Lifecycle
Compensating Wage Differentials
Investments in Human Capital
Mobility of Labor
IV.
Issues in Labor Economics
Pay and Productivity
Gender, Race and Ethnicity
Collective Bargaining
Inequality in Earnings
Unemployment
6
7
8
9
10
11
12
13
14
15
RECOMMENDED STUDY HABITS:
Economics is a challenging subject for most and requires significant study to successfully master
and apply economic concepts. I suggest that you read, or at least skim, the chapters in the text
before they are covered in class. As soon after class as possible, I suggest you retire to a quiet
place and reread the text and recopy the lecture notes. Please use the study tools available on the
companion website of the book.
http://wps.aw.com/aw_ehrensmith_mlaborecon_10/
This will help reinforce what you have learned and point out areas that you need clarified.
Feel free to ask questions in class. Remember, “There is no such thing as a dumb question.”
Also, please make use of office hours, particularly when you need a bit more help understanding
the material.
EVALUATION:
Grades will be based on homework, three mid-term examinations, and an optional
comprehensive final examination. Makeup examinations will only be given for emergencies and
require a note signed by a physician or by a senior officer in Student Affairs.
Homework will be assigned in class and will total 100 points.
Three midterm examinations will be given. The midterms dates are Friday, April 18, Friday,
May 9, and Friday, May30. No early or makeup finals will be given. If you cannot attend
class on these dates, drop the class and take it at another time. Each midterm will count for
100 points.
The final will count for 100 points and will replace the lowest midterm score. The final date is
Friday, June 6th, 8am. No early or makeup finals will be given.
GRADING:
Grade are based upon the percentage of the 400 possible points. The following scale will be
used to determine the final grade:
A
AB+
B
BC+
C
CD+
D
DF
>=93%
>=90% and <93%
>=87% and <90%
>=83% and <87%
>=80% and <83%
>=77% and <80%
>=73% and <77%
>=70% and <73%
>=67% and <70%
>=63% and <67%
>=60% and <63%
<60%
MISCELLANEOUS:
The classroom should be a productive, pleasant, and interesting learning environment. As a
consideration to your classmates, please make an effort to be on time. If you do arrive after the
lecture has begun, a quiet entrance would be greatly appreciated. In addition, please refrain from
eating and yawning noisily during class and making conversation with your colleagues.
Students with disabilities who wish to set up approved academic adjustments for this class
should schedule a meeting with the professor as soon as possible. Please provide the professor
the “Confirmation of Eligibility for Academic Adjustments” provided by the Disability Support
Services Office. Students with disabilities without the confirmation should contact the Disability
Support Services (DSS) Office, Bouillon 205 (dssrecept@cwu.edu , 963-2171). Students who
believe they may be affected by a disability are also encouraged to contact the DSS office.