13. Problems and Applications Q8Structural unemployment is sometimes said to resultfrom a mismatch between the job skills that employerswant and the job skills that workers have. To explore thisidea, consider an economy with two industries: automanufacturing and aircraft manufacturing.If workers in these two industries require similar amountsof training, and if workers at the beginning of theircareers can choose which industry to train for, whatwould you expect to happen to the wages in these twoindustries?Wages between the two industries would be equal.Wages in the auto manufacturing industry would begreater than those in the aircraft manufacturing industry.Wages in the auto manufacturing industry would be lessthan those in the aircraft manufacturing industry.Wages in the auto manufacturing industry could begreater or less than those in the aircraft manufacturingindustry.Suppose that one day the economy opens itself tointernational trade and, as a result, starts importing autosand exporting aircraft.This would cause the demand for labor in the auto_____and the demand formanufacturing industry tolabor in the aircraft manufacturing industry toSuppose that workers in one industry cannot be quicklyretrained for other.In the short run, wages in the auto industrywouldwouldand wages in the aircraft industryHow would these shifts in demand affect equilibriumwages in the long run?Wages between the two industries would be equal.Wages in the auto manufacturing industry could begreater or less than those in the aircraft manufacturingindustry.Wages in the auto manufacturing industry would begreater than those in the aircraft manufacturing industry.Wages in the auto manufacturing industry would be lessthan those in the aircraft manufacturing industry.If for some reason wages fail to adjust to the new short-run equilibrium levels as a result of opening up tointernational trade, there will be a_________________ of workersin the aircraft industry and aof workers in theauto industry.

Structural unemployment is a type of unemployment that is caused by a mismatch between the skills…

Structural unemployment is sometimes said to result from a mismatch between the job skills that employers want and the job skills that workers have. To explore this idea, consider an economy with two industries: auto manufacturing and aircraft manufacturing. If workers in these two industries require similar amounts of training, and if workers at the beginning of their careers can choose which industry to train for, what would you expect to happen to the wages in these two industries?

Structural unemployment is sometimes said to result from a mismatch between the job skills that employers want and the job skills that workers have. To explore this idea, consider an economy with two industries: auto manufacturing and aircraft manufacturing. If workers in these two industries require similar amounts of training, and if workers at the beginning of their careers can choose which industry to train for, what would you expect to happen to the wages in these two industries?

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

13. Problems and Applications Q8
Structural unemployment is sometimes said to result
from a mismatch between the job skills that employers
want and the job skills that workers have. To explore this
idea, consider an economy with two industries: auto
manufacturing and aircraft manufacturing.
If workers in these two industries require similar amounts
of training, and if workers at the beginning of their
careers can choose which industry to train for, what
would you expect to happen to the wages in these two
industries?
Wages between the two industries would be equal.
Wages in the auto manufacturing industry would be
greater than those in the aircraft manufacturing industry.
Wages in the auto manufacturing industry would be less
than those in the aircraft manufacturing industry.
Wages in the auto manufacturing industry could be
greater or less than those in the aircraft manufacturing
industry.
Suppose that one day the economy opens itself to
international trade and, as a result, starts importing autos
and exporting aircraft.
This would cause the demand for labor in the auto
_____and the demand for
manufacturing industry to
labor in the aircraft manufacturing industry to
Suppose that workers in one industry cannot be quickly
retrained for other.
In the short run, wages in the auto industry
would
would
and wages in the aircraft industry
How would these shifts in demand affect equilibrium
wages in the long run?
Wages between the two industries would be equal.
Wages in the auto manufacturing industry could be
greater or less than those in the aircraft manufacturing
industry.
Wages in the auto manufacturing industry would be
greater than those in the aircraft manufacturing industry.
Wages in the auto manufacturing industry would be less
than those in the aircraft manufacturing industry.
If for some reason wages fail to adjust to the new short-
run equilibrium levels as a result of opening up to
international trade, there will be a_________________ of workers
in the aircraft industry and a
of workers in the
auto industry.

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