Question

“An increase in minimum wage will lead to the age of machines faster.” – Glenn Reynolds In your opinion,

what is meant by this quote by Mr. Reynolds? Do you agree or disagree with his statement. Why or why not?

Attachments Skills Explain the factors that shift supply and demand in the labor market including technology and minimum wage.

Answer 1

Glenn Reynolds mean by this quote that as the wages given the the workers is increased, the employer would want to hire only the most efficient employees to attain the maximum results and would prefer hiring robots which could be operated by these efficient employees and would also reduce the cost and give maximum output.

I agree with Glenn Reynolds because as the wages of the workers increase the demand falls and the supply increases which will certainly lead to more machine used.

Any factor that causes the demand for the labour to increase will shift it's demand curve to the right and vice versa and similarly with the supply.

When the demand of a good increases it also increases in the demand for labor which causes the labour demand curve to shift to the right.

When the number of companies in the market increase the demand for labor increases and the curve shifts to the right. Depending upon the productivity of the workers a government regulation can increase or decrease the demand for workers. Technology acts as a substitute as well as a compliment when it comes to labor demand curve. When it acts as a substitute, it's demand curve shifts to the left whereas when it acts like a compliment the demand curve shifts to the right.

The supply curve also shifts with some factor change. When the number of workers is more the supply curve shifts to the right and vice versa. When the education qualification required is more, the supply of labor is less. Also an increase in technology leads to a less supply of workers as only the efficient ones can work with the new technology. Government regulations also affect the supply of labor in the market.