Labor Economics
8th Edition
ISBN: 9781260484434
Author: George Borjas
Publisher: Mcgraw-hill Higher Education (us)
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Question
Chapter 9, Problem 5P
(a)
To determine
Determine the male-female differential in the labor market.
(b)
To determine
Determine how much of the wage differential could be discrimination in terms of Oaxaca-Blinder decomposition.
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1. Consider two firms (i=1,2) interacting in the market. Assume that firms compete in
quantities and therefore they choose either to cooperate or not in each round. If a firm
deviates it earns monopoly profit for a round and a punishment phase will follow from next
round onwards (for ever) where both firms choose the Cournot quantity. Assume a
discounting factor & and that firms meet in the market in every period. The demand facing
the industry is p = 1 92. Let Q = q1 + 92 denote the aggregate industry output
-
91
-
level. Assume further that production is costless.
Q4 (30 points)
Subsidy in Auctions
Consider a sealed-bid second-price auction with two bidders. Valuation of bidder 1 is drawn
from the uniform distribution on [0, 100], and valuation of bidder 2 is independently drawn
from the uniform distribution on [0, 300].
$
A
C
°
Output
Refer to the diagram, which pertains to a purely competitive firm. Which of the following statements is most accurate?
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