6. Contrasting labor union laws in two states Consider two states that adopt dif

Question

6. Contrasting labor union laws in two states Consider two states that adopt different laws concerning labor unions The following graph shows the labor market in a state in the North. Initially, the market-clearing wage there is $8.00 per hour Suppose that the legislature in this northern state passes laws that make it easy for workers to join a union. Through collective bargaining, the union negotiates a wage of $10.00 per hour Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph Graph Input Tool Market for Labor Wage (Dollars per hour) Supp 2.00 Labor Demanded (Thousands of Labor Supplied (Thousands of workers) 12 1,400 200 10 4 emand 0 200 400 600 800 1000 1200 1400 1600 LABOR (Thousands of workers)

Explanation / Answer

At the union wage rate @$10 per hour 600 thousand union workers would be hired.

Workers at the northern state employed at the union wage rate are in better off situation because they are getting higher wage $10 per hour more than market clearing value of $ 8 per hour .

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