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Competitive labour market equilibrium

Competitive labour market equilibrium

The demand for labour is a derived demand because firms hire workers to produce goods and services. A competitive, wage-taking firm's labour-demand curve is its marginal revenue product of labour (MRPLMRP_LMRPL​) curve and slopes downward over the relevant range. This reflects diminishing marginal returns: as more workers are employed, the additional revenue generated by each extra worker usually falls.

3.5.3 Wage determination in competitive and non-competitive markets Lesson

  1. A Level
  2. /Economics
  3. /3.5.3 Wage determination in competitive and non-competitive markets

Step-by-step lessons on Edexcel A A Level Economics 3.5.3 Wage determination in competitive and non-competitive markets. Each one builds up to exam-style questions. Start with the core supply-and-demand models before moving on to the more evaluation-heavy macroeconomic policy topics.

Lessons