Question

Give two examples of events that could shift the supply for labor and explain why they do so. Which way does the supply curve shift in each of the examples.

Answer 1

Sol :

Two examples that will shift the labour supply curve are as follows :

(i) Changes in taste and preferences : when the preferences of the workers changes about a nature of job. For example : decrease in number of women for the job as preference for staying home is risen.

(ii) Immigration : Immigration means the process of moving of workers from one place to another. This will also change the supply curve of the labour.

In example 1 , Supply curve will shift to the left as taste and preference for the women doing job decreases.

in example 2 , supply curve will shift to the right , if immigrants increases and vice - versa.