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Monday, August 05, 2013

Labour Market and Government intervention

Grade 8 A

Discuss how a government might influence the demand for and the supply of labour."


Time Duration for submitting the Article is 

 Aug  5th to August 11th, 2013 

 Write your answer here in 500 Words. 
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19 comments:

  1. Government influence the demand for and the supply of labor by releasing the rules and regulation for example The person who are allowed to work according to government rules and regulation are from age 18-70 so this will decrease the supply of labor because people below 15 and above 70 can't work but if people below 15 work there won't be any educated labor in the future because they don't completed their study and specially for those who don't have money to go to school.

    Because of that the government give subsidy for a cheaper school fees in public school so there will be more educated and qualified people to work in the future and it will increase the labor supply also it will also increase the labor demand because of the better quality worker.

    Government also can invited other country's companies to invest their business in Indonesia so it will absorb labor and increase the demand in labor .

    Government also can set the minimum wages increase or decrease for labor. If increase it will increase the supply in labor but will decrease the demand from the companies because their cost of production will increase.

    But if the company is technology intensive industry may need less workers so will need less demand of labor.

    But as the education increase because the government subsidies the school fees so there will be more educated people but the disadvantage we will have less people to be a labor in a factory and many people willing to have less children so there will be decrease in young generation and population so there will be a decrease in supply of labor.

    Social security conduct by the government for the worker also impact on the demand and supply of labor. For example in African countries there is a lots of diamond and gold reserve so the companies from other countries mine the minerals there and it will increase the labor demand.

    In Indonesia there's some people who work as a maid in other country such as Malaysia and Saudi Arabia. The government also help to contribute to train and send them to those countries so the demand and supply of labor increase.

    Government give taxes to the company that have a dirty job or job with high risk so demand of labor decrease because they have to spend more money for the safety of the job.

    The conclusion is government also have a big influence to supply and demand of labor.

    Nicolas Samuel Lumy
    8A



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  2. Wages it self can be defined as determination of supply and demand. Supply of labor is depending on both the wages rate and the labor supply. If the wage rate is increasing, so the labor supply is also increasing. When the wage rate is decreasing, so the labor supply is also decreasing. We can say this system as ‘positive relationship’ or we can say also as ‘upward slopping’. And there’s another system that opposite from supply of labor, we called it as demand for labor. Demand for labor is depending on both the wages rate and the labor demand. If the wage rate is increasing, so the labor demand is decreasing. When the wage rate is decreasing, so the labor demand is increasing. We can say this system as ‘negative relationship’ or we can say also as ‘downward slopping’. Factors that might affect labor supply are wage rate, job securely, chances of promotion, high status, work flexibility, fringe benefits, also government rules and regulations. Government rules and regulations affect the demand and supply, for example the people who work that don’t have enough money for paying their children to go to school, government gives rules and regulations that children should go to school within 9 years (that is primary and secondary), and government give the free school fees for 9 years and that rules and regulation can make young generation more educated and have more quality, so they can get work that better in the future. Other example is that the industries or factories outside Indonesia invest their business in Indonesia. They also need labors for their factory and of course they will take labors from Indonesia. So, they affect the demand for and supply of labor. Other example is there are some of Indonesia people that work outside Indonesia; examples are in Malaysia, Hong Kong, Saudi Arabia. Before they go work, government gives training for them so they can work well at certain countries. After the training, the government sends them to certain countries that need more labors; that example also makes the demand for and supply of labor increase. There is three differences economic systems: market economic system (that is for private sector or individuals), planned economic system, and mixed economic system (so both the market economic system and the planned economic system). Planned economic system is the economic system is more on public sector. It means that government more takes place. The differences between public sector and private sector are the wages, status, and security. Public sectors have lower wages whereas private sectors have higher wages. And private sectors have lower status whereas public sectors have higher status. Also in security, private sector have lower security whereas a public sector has higher security. Word ‘security’ here means that the safeties of public sectors are more than private sectors, example if president goes somewhere by car, beside the car there are policies that guide, also the way that they will go will be closed until they already go to that way. From this explanation, we can see that government influence the demand for and the supply of labor. So my opinion is government also influence to the demand for and supply of labor.

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  3. Factor that affect the supply labor are : location, wages, difficulties, fringe benefit , time of work , and security job. The factor that influence the demand of labor are : factor of substitution, wages , and the rules of government. This time we only discuss about how goverment influence the labor market. Government can influence the labor market with their rules and regulations. Some rules are protecting the employees. Example : the rules of minimum wages , the public holiday ( the make the employee does not stress) , the time of work , and the rules that burden the discrimination. Every regulations about the labor it affect the demand and the supply of labor, especially the demand of labor. The government’s rules have been made to avoid explotation of workers
    The government must upgrade the quality of the workers so that they can adjust them selve with the situation and condition , those things access of labor from 1 sector to the minus sector. The government also appealed the enterpreneur to make can be achive by improving labor mobility of labor and as soon as possible to remove the a new small business that employ many workers those kind of rules will increade the demand of the labor. The governmet also help the unskilled workers with retraining them so that they can improves their skills to work, government also give an open information about job vacation to people in media like newspapper, email , advertising in internet, website job , magazine, etc. Goverment do these things to increase the supplu of labour.
    Encourage the level of education also has been done by government to make the supply of labor increase and the quality of the people is good enough. The requirment of modern industry also make the worker must be trained so that they doesnt replaced by machine. The government, must make a regulation about this. Government organize how many minimum people work in that industry, and how many machine are used in that industry. The minimum wages are arrange by goverment to protect the workers from explotation by powerfull employee. The minimum wages are different in each country, it depends on the government decision. An examples : the minimum wages in america is very cery high, but the minimum wages in indonesia is very low. It happens because in america the government very pay attention with prosperity of the workers, in indonesia the government doesnt give a lot of attention to them.
    Some how the mayor employer can set the makret wages, so the workers are paid with a low wages. To avoid these situation, government must make a law that control the power of employers and trade unions over wages and working conditions .Government also provide a save working enviroment and protectiong the right of employee and employers . All those kind of rules and regulation , directly affect the demand and supply of the labor. The high minimum wages will decrease the demand of labor the law that protect the right of employers, will increase the demand of labor, the law that protect the right of employees will increase the supply of the labor.
    IN CONCLUSION the government can influence the supply and demand of labour market by law that protect the right of employee and employers , the law that limit the powerfull of big trade unions and major employers, make a minimum wages registlation , to reduce an employment by training them and make a law to remove discrimination

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  4. In definition, government is the people who organize the country. Government influence the demand and supply of labour because the government provides rules and regulation. Factors that influence the demand and supply is wage rates and number of workers. Other than government rules and regulation, there are also many factors that influence the supply of labour, such as wage rate, job security, chances of promotion, prestise, high status, work flexibility, and fringe benefits. If wage rate goes up, the supply of labour will goes up to,and if the wage rate goes down, the supply of labour will goes down too. But if for the demand of labour, if the wage rate goes up, the labour of demand will go down, and if the wage rate goes down, the labour of demand will go up. Government influence the demand supply of labour because of the age rule, meaning that people too young may not work, and old people like grandmas and grandpas also can’t work. Because if they work, it will not be good for the company. So because of that the supply of labour might decrease. The government also determine the minimum wage, so that it will not be too little. Because if the minimum wage is too little, no one will work. So the demand for work will falls. Government rules and regulation also include that a company should pay equal payments to the workers. So that it will be fair. Government also determine the holidays, like the public holidays, so that the workers will not be too stress of their work. If the workers do not get holiday, I don’t think they will want to work. So this factor influence the supply of workers. The government also determine the working place or environment. It determine the working environment to be safe and appropriate for workers to work. If the working place is dangerous and inappropriate, less people will want to work. So the demand of the workers will go down. Government will also influence the demand for and supply of labour by tax. If the tax is too high, less people might want to work, but if the tax is normal, more people will want to work. So this influence the supply of labour. Government also provide the rules for no discrimination. For example a company may not choose workers by their skins, like is they black people or white people, the company should be fair to choose workers. So there should be no discrimination. This will increase the supply of labour because if only special people that can work, the supply of worker will be less. Government should also provide assurance for health and safeness for the workers. This will protect the workers for the company. There should also have the minimum and maximum working hours, not too long and not too short. So that it will be normal and fair for the workers. So in conclusion, the government can influence the demand for and supply of labour by many factors such as minimum wages, the age, tax, health and safeness of workers, working hours, and holidays.

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  5. Governments usually intervene in determining labor market. Regulation there is protecting the rights of the employee and employers. Also, government makes some rules to prevent exploitation of workers by power employers. Some example of the government rule of labor is related to the law of the minimum wage, the limited power of the major trade unions or employers.

    Government policy in a wide variety of areas has a significant influence. Goverment Influences the demand and supply of labor in direct or indirect ways. increasing regulation of labor market seen as being damaging claims by some business legislation and taxes depress the demand for labor.

    The employee legislation has been made by government to protecting the rights of employees. Sometimes the major employers can set a market wage while a trade union may use its power over the supply of the labour. There are some example employee’s right to receive a holiday per year, not to have to work more than 48 hours each week, to have protection unfair dismissal and the right to defend the action at an employment tribunal, and to comply with health and safety regulations. These rights are protecting legally by governments law. these kind of law will increase the supply of labour.

    National insurance contribution (NICS) is a system of contributions paid by workers and employers towards the cost of certain state benefits. It was initially a contributory system of insurance against illness and unemployment, and later also provided retirement pensions and other benefits. This rule are made by government so if something bad happen to employer or employee, the insurance of employee or employers will paid them some of amount that is written in insurance’s contract. It affects the demand of labour and also affects the supply of labour. The law of minimum wage also affects the demand of labour and the supply of labour. If government makes a rise in minimum wage, so the supply of labour will increase, oppositely, the employers will not agree about this. Because if the minimum wage rise the expense of that company also rise. So the demand of the labour will decrease, but the amounts of minimum wages are different in each country, because the focus of prosperity in every country is different. This law make worker has protected from exploitation by employers.

    The government will give best education to their people to make them have a skill to get a job, the government also training a worker to help them compete with other worker from other country. Technologies in modern industry also become a challenge to a worker. If a worker cannot compete to machine, machine will replace worker, so the government the knowledge and train them. The law that burden discrimination also help the worker to get a job. It is unlawful in many countries discriminate against people because o their raise, gender, religion, and age. Because of this situation the government make a law that burden discrimination (this law affect the demand and the supply of the labour). A government also can provide an employment service to help people look for job. In this way a government can reduce the cause of searching for employment and increase the mobility of labour.

    So, the conclusion, government can influence the supply and the demand of labour with employment legislation, NICs, tax rate, employment subsidies, market information, benefit system, education policy, minimum wage legislation, trade union legislation.

    Winson 8A

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  6. The demand for labour is the need of firms to employ labour or workers to give services to the firm. In return, the labour will receive wages or salary. The demand for labour can change over time due to several factors, including wage rate – higher wages will decrease the labour demand, technological advances, resulting firms to be more capital-intensive rather than labour-intensive if equipment are cheaper than labour, and the demand for products: if the demand for the goods produced by the firm decreases, the firm would not need as much labour to produce them, decreasing the demand for labour.

    The supply of labour refers to the total number of hours that labour is willing and able to supply at a set amount of wages. The supply of labour might vary, as individuals will consider factors such as the wage rate – higher wages will increase the labour supply, and non-wage benefits, such as job security, chances of promotion, work flexibility, fringe benefits (facilities provided by the firm for its workers), and prestige. If the non-wage benefits mentioned rises, supply of labour is likely to increase.

    The demand and supply of labour would always vary in time, causing some imbalance to happen at some point. Private companies would only employ a specific kind of workers, with work discrimination still occuring in many parts of the world, and unemployment levels will rise if there is no intervention. The government is required to intervene the labour market to prevent an economic crisis from happening. A government might influence the demand for and supply of labour in several ways.

    Governments might imply laws and regulations for workers. Various employment legislations could be applied to firms to provide fairness to workers, creating a better and safer working environment. These regulations include equal pay, health and safety, and pension rights. An example of regulations involving equal pay is the Equal Pay Act of 1963 in the United States, which was signed into law by President John F. Kennedy. The federal law was aimed to abolish sex discrimination in work. Health and safety laws have been applied in many countries in the world, including Indonesia, which was Safety Act No.1 of 1970. Pension rights have also been applied in most countries, with the pension age commonly being above 65 years old. However, some economists argue that the necessity of meeting legislation would only impose costs on businesses, causing the demand for labour to shift to the left.

    Governments might also increase or decrease the tax rates of employees’ payroll or firms’ profits. If the government decrease the tax rates of the employees’ payroll, the net pay will increase, resulting the labour supply to rise. However, if they increase the tax rates of employees’ payroll, labour supply will fall in result of falling net pay.

    If the government decrease the tax rates of firms’ profits, firms would feel that they have more money to employ labour, causing labour demand to rise. On the other hand, if the government increases the tax rates of firms’ profits, firms would need to spend more money in paying taxes, discouraging people from opening up new businesses and employing new workers. This causes the labour demand to fall.

    Governments might supply employment subsidies, or wage subsidies, to employers. Wage subsidies are assistance packages for employers to employ workers with financial help from the government. This comes with some criterias, an example being workers employed must have had no or minimal work experience. In this way, governments will encourage employers to employ new workers, and for unexperienced workers to earn some experience. The aim for these programs is to increase the labour demand in a country. Some governments, such as the Australian government, has provided these kind of programs.

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  7. Governments might also set minimum wage regulations to prevent workers from earning unfair wages. The law prohibits employers from hiring workers for less than a given minimum wage. More than 90% of all countries have this legislation. However, some countries (in the European Union), such as Sweden, Finland, Denmark, Switzerland and Italy do not have a national minimum wage, but rely on employers and trade unions to set minimum wages through collective bargaining.

    The most effective way of influencing the labour market is to create job fields itself. This is the reason why governments provide many job vacancies in the public sector. Governments create more job fields, thus employing more people. Without the public sector, more people would have been unemployed. Examples of work in the public sector include: the police, military force, public transit, education and health care.

    However, wages in the public sector is usually lower than wages in the private sector, especially in developing countries. The most common case is Indonesia, which is said to have ‘one of the most poorly paid public officials in the world’. This is a key determinant of government corruption. A recent report by the World Bank for the Consultative Group on Indonesia finds that “where civil service vlerks make about half that of their private sector counterparts, director-generals make one-tenth to one-fifteenth.”

    There are several reasons why a government would intervene or influence the labour market. The government keeps a planned economy stable. A market without government intervention would be referred as free market, and this is not always good for the labour market in a country. The main reason why is that many people will be unemployed. The private sector, who runs the free market economy, would only employ the best of the people. The business world is considered to embody the concept of ‘the survival of the fittest’. Without the public sector, no one would employ the rest of the labourers, causing rising unemployment. This could result in higher poverty levels and rising crime levels in the country.

    A government intervene in labour markets to protect the rights of both employees and employers. May employees are paid less than minimum wages, and some trade unions do not provide the productivity expected by employers.
    Another reason why government intervene the labour supply is to raise the wages of the lowest-paid labour. Many countries have determined the minimum wage legislation to protect low-paid workers, such as in Indonesia, which is currently around Rp 2.2 million per month.

    The last reason to be discussed is that government might intervene the labour market to outlaw discrimination. In the apartheid times in South Africa, black people change are discriminated because of their race. They could only work with very low wages, half of that white people earn. Nowadays, discrimination still exists in many forms. Statistical evidence is present in wage differentials, stating that discrimination does exist in the modern world, with types such as gender, race, caste, age, and religion.

    In conclusion, government is a major influence in influencing the demand for and supply of labour, or in other words, interventing the labour market. The government could do so by applying laws and regulations, changing tax rates, giving subsidies, and creating new job fields. They would intervene the labour market to prevent discrimination, protecting the rights of employees and employers, and to raise the wages of poorly-paid workers.

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    Replies
    1. Typing error: Paragraph 3, Section 2 - the word 'vlerks' should have been 'clerks' - "where civil service clerks make about half that of their private sector counterparts ..."

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  8. Supply of labour means the number of people that want to work for the government. Government can influence the demand of labour supply in many ways, such as: wages rate, job security,chances of promotion, work felxibility, fringe benefit, rules and regulations and also where the industries or business is located. They can effect the decrease and also increase of the supply labour.

    According to the graph, generally if wages rate of labour supply decreases then the quantity labour will also decrease, it cause expansion on the graph and it also works the same for the increase in wages rate. We can say if government give higher wages, the demand of the workers to work will increase, of course it’s because they want to get more money to cover their need or want and we can see how dirty job influence the wages rate. People who do dirty job will get higher wages for sure, dirty job is a job that not all of the people are willing to do it because the job can be harmful, difficult,strange and messy, for example: morticians, recycle plant workers and semen washers.

    Job security is also another reason. What is job security? Well, it means people will get assurance that their jobs remain stable, it’s like the guarantee they get. A people with high level of job security has smaller chance of being unemployed.

    There will be lesser demand of supply labour if there is no promotion.All of the workers need promotion to gain their status into higher position because higher positions earn more salary but they will need more responsibilities and more time is needed to perform their jobs.

    Some people feel satisfied when they earn promotion and they may get their chances to develop their skills.To keep the labour supply increasing, government need to give work flexibility to all of the workers. Work flexibility is freedom they get in deciding how their work will be done and how will they coordinate the schedule. In that way they can get many benefits. They will enjoy their work better, which means it release their stress also it increase feeling of control over schedule and work environment.

    Another one is fringe benefit. Fringe benefit means the worker receive additional things aside from wages and salaries. For example: house allowance, medical insurance, pension plans and vacation pays. In that case, more people will be attracted to work for the government.

    Changes in age of the workers can effect and decrease the supply of labour. If the government’s rules and regulations stated that before, minimum at the age of 15 to 60 years old people can work and now minimum at the age of 25 years old people can work then there will be lesser people that can apply the job. Place and the environment of the job will cause less workers too because maybe that place is dangerous or far from their house, the cost of transportation is expensive. My conclusion is that we can find many examples and factors that effect the demand of supply labour.

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  9. Labour market influences some of the factors, for exampe, market power, external influences, trade union, and government. I will discuss more in government sector. Government might influence the demand for and the supply of labour because they prevent discrimination happen. Government make rules and regulation, for example by giving subsidies, changing tax rates, make education policy, market information (job centres), and give the minimum salary for the wage rate or minimum wage legislation. So, they have to intervene the demand and the supply of labour.

    The supply of labour is the amount of labour that is supplied to fulfill companies demand of labour. There are some factors that affecting labour supply, such as, wage rate (higher wages can increase the labour supply), job security, chances of promotion, prestige, high status, work flexibility, fringe benefit (bonus facilities from the firm to the worker), and government rules and regulation. If that factors likely to rises, the labour supply will increase. Similarly, individuals wishing to maximize their well-being, make choices about how to allocate their time between competing uses: leisure, non-market activities, and time in the labor market. The higher the rate of pay they anticipate receiving, the greater the amount of time allocated to the world of work, and the greater the number of individuals choosing to participate in the world of work. This creates the concept of the upward sloping relationship between wage rates and the level of employment. Symmetrically, forces at work bring about additions or subtractions to labor supply and therefore would displace the supply curve rightward or leftward. Let us consider a few of such forces and their effects. Such as, a population growth that produces a change in the size of the labor force, changes in preferences toward labor market work, changes in time in school and in training, changes pension plans and disability insurance programs, and a changes in the age composition of the work force.

    Several forces affect wages and employment levels through the demand side of the labor market. We’ll start with three important sources of change and then talk about how they cause the demand curve to shift. Such as, Change in consumer demand, long-term change in labour productivity, change in government regulations or taxes which change labor costs. In labour demand, firms seeking to maximize profit will hire more workers at lower wages. This creates the concept of the downward sloping relationship between wage rates and levels of employment.

    The supply and labour demand not always the same. Public sector (government) give low wages, high status, more security policies, and high chances of promotion. Private sector give high wage, lower status, less security policies, and low chances of promotion.

    In conclusion, government influencing the supply and demand of labour. Government should intervene the demand and the supply of labour to prevent discrimination happen. So that government make rules and regulation, such as, give subsidies, change the tax rates, make education policy, market information (job centres), and give the minimum salary for the wage rate or minimum wage legislation.

    Vienetta Christina
    8A

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  10. Government gives a rule and regulation that people only may work from the age of 15 till 60, which have higher supply of labour rather than only 25 till 60 years old that may work (example). Government give the rule that minimum age for working is 15, because from the age of 1-14 children and teenagers need to go to school for education because by more educated person there will be higher supply of labour because educated person can be hired or have a greater chance to be hired than the uneducated person. Some parents don't have the finance for giving their children to go to school, that's why government subsidy schools and build a school for poor children for free.

    Government also can influence the demand of labour by giving higher taxes to companies or firms which could effect the wage given by the firms or companies to their employees or workers. Government also can increase and decrease the minimum wage which could change the demand of labour. If the minimum wage increases people will have greater/higher demand because workers or employees are given higher wages, but if the minimum wage decreases workers and employees are given less wages which would effect the demand of labour decreasing.

    Government gives tax to firms or companies that produce unhealthy goods and services that could also not be beneficial for people or community, which influences the demand of labour because firms don't want to have any loss so they decrease the wage given to the employees or workers.Examples of unhealthy goods and services or no beneficial goods to communities or people, are cigarettes, production of goods that creates many pollution,and alcohol which could make people drunk and cannot control themselves, and more. Government also gives subsidy to firms or companies that produce beneficial goods and services for community or peoples, and government also gives subsidies to goods and services that are needed for all people. Subsidy from the government influences the demand of labour because if their goods are cheaper for the community or for people, there would be more demand of supply of their goods which means that the firms or companies get more profit and they can increase the wages given to their workers or employees. Examples of goods and services that are given by the government are, schools so that children can have education to help them to be educated and easier to find a job when they grow up, mineral water because everybody needs clean mineral water so government gives subsidy so more people can drink clean mineral water, and gasoline for people to drive their car to their destination.


    Government build hospitals,schools,and police station, which is not only beneficial to the one who needs the service but government also hires people that work in that service, so people that have no job can have wages or money for their living, it also effects the supply of labour because people are already hired by government, the firms or companies demand decreases because less people wants to work in our company because they already have a job.

    Government could influence the demand and supply of labour not only giving tax and subsidies to goods and services but government also can give taxes on the land or premises where they are producing or selling, it also effect the wages of the employees or workers.

    Conclusion: Government can influence the demand and supply of labour with many factors and ways.

    Brian Agustino
    8A

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  11. The demand for labor and supply of labor can be affected by many factors,such as:wages,job security,fringe benefits,prestige,high status,promotion chances,work flexibility and lastly government rules and regulations.All of the factors can affect the demand for labor and supply of labor,we will now discuss why government rules and regulations can affect the demand for and supply of labor.In public sector,the government rules over the market,they make rules and regulations in the public sector unlike the private sector which is free of rules.An example of the rule the government made in the public sector is that people can only work when they reach 15 years old,and they have to stop working when they reach 60 years old.This can affect the supply for labor badly because now children in the age of maybe 7-14 can't work because of that rule,people in the age of 61-90 can't work too,thus the supply for labor decreases drastically,but the government also has a point in doing this because children can't work,even if they do their wage will be very unreasonable and old people can't be forced to work because it's already time for them to rest and enjoy all the money they have gained while working in their young days.Government can also affect the demand for labor,they now gave tax to large companies when they employ a worker,it's quite high so companies won't risk having a lot of workers and thus the demand for labor decreases drastically.In the public sector,government also has the authority to change the minimum wage of a worker,if they decided to increase the minimum wage of a worker,the demand for worker will decrease because of they high price companies need to pay for their workers,but the supply of labor will increase because now people will get more money if they work and maybe more will get motivated by this.But if the government decided to decrease the minimum wage of a worker,the demand for labor will increase because now companies have to only pay a small amount to be able to employ a worker,but the supply of labor will decrease because people will get less money if they work so maybe some of them will lose their hopes in trying to get a job.Government set all this rules in the public sector because they wanted to protect the rights of a person.They wanted to especially protect the rights of the employers and employees.Government won't want children to work when they don't even know the world yet,if they work now,their future potentials will be wasted and it will be bad for the country because if this happens to all poor people then who will later lead this country when all those potentials from the younger generations are all crushed.They all wanted to prevent the old people from working because they wanted them to just relax and enjoy their life,they wanted to thank all those old people for their efforts in building this country together.This rule is just like an appreciation to our previous generations,to our ancestors.The government also wanted to give people more money by increasing the minimum wages of a worker,they don't want people to get an unreasonably small amount of wage when they have worked so hard.It's not fair,they also decrease the minimum wage of a worker because they wanted to help companies by lessening the amount companies have to pay in order to employ a worker.This is done so a company can grow faster and can help the economy in the nation grow to an even higher level.

    Conclusion:Government can do a lot of things that can affect the demand for and supply of labor but they do all this things to protect the rights of both the employers and the employees working at the public sector.

    Jovan Pan
    8A

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  12. The Demand and Supply labour are affected by the Government in many ways, including taxation, subsidization, legislation, persuasion, and nationalization. Tax is a financial charge or other levy imposed upon a taxpayer (an individual or legal entity) by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxation affects supply and demand labour by Taxes reduce both demand and supply, and drive market equilibrium to a price that is higher than without the tax and a quantity that is lower than without the tax. Tax authorities usually require either the buyer or the seller to be legally responsible for payment of the tax. Tax incidence is the way in which the burden of a tax is shared among the market participants ("who bears the cost?"). Taxes will typically constitute a greater burden for whichever party has a more inelastic curve – e.g., if supply is inelastic and demand is elastic, the burden will be greater on the producers. Suppose that a state government imposes a tax upon milk producers of $1 per gallon.
    If buyers have many alternatives to a good with a new tax, they will tend to respond to a rise in price by buying other things and will, therefore, not accept a much higher price. If sellers easily can switch to producing other goods, or if they will respond to even a small reduction in payments by going out of business, then they will not accept a much lower price. The incidence of the tax will tend to fall on the side of the market that has the least attractive alternatives and, therefore, has a lower elasticity. Cigarettes are one example where buyers have relatively few options; we would therefore expect the primary burden of cigarette taxes to fall upon the buyers.
    A subsidy shifts either the demand or supply curve to the right, depending upon whether the buyer or seller receives the subsidy. If it is the buyer receiving the subsidy, the demand curve shifts right, leading to an increase in the quantity demanded and the equilibrium price. If the seller receives the subsidy, the supply curve shifts right and the quantity demanded will increase, while the equilibrium price decreases. A quota limits the amounts of a good that can be produced. If the quota is greater than what would be produced under normal market conditions, then it will have no effect. If the amount is less, than the market equilibrium that is achieved will be at a higher price than what would occur without the quota, as consumers will be willing to pay more.
    Making a good or service illegally impacts demand, supply and market equilibrium by imposing a cost (prosecution and punishment) on the buyer or seller (or both) of the good/service. Quantities of illegal goods will always be less than if they were legal, but the impact on price is determined by whether the buyer or seller (or both) is punished. If the only the buyer is penalized, the equilibrium price will be lower; the risk of punishment is regarded by buyers as a cost, and reduces the price they will pay to the seller. If the seller is penalized, the equilibrium price will be higher as the cost of punishment is factored into the seller's cost. Prices will remain relatively unchanged if the risk and cost of punishment is shared equally.

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  13. The term of supply and demand of worker is refer to the quantity of workers demanded or supplied for each quantity of wages. As we know generally there are several factor affecting the supply and demand of worker, one of the factor which is most influencing factor for this is government. As we know before, government is organize structure of people which work in public sector who have right to lead people in a country or region and making rules and regulation which's can affected many people, because of they've a right in making rules and regulation that valid for many people so they also have a right for determining the rules and regulation for the worker which can affected both demand and supply of the worker.
    From the statement above, we can see clearly that it's always valid for people who work in public sector because of government is the one who pay their wages, but how about the public sector? Sometimes we are thinking that how can government determining the supply and demand of worker because of they don't pay the worker's wages but remember about the rules and regulation that government can make it is can affected much for all worker and company. First, government can make rules and regulation about the minimum wages for the worker, this minimum wages is being the standard measurement for the company in giving wages and also for the worker who receiving the wages. If the minimum wages is high, worker will be attracted to work which cause the supply of the worker high, but in the other side, the workers demanded by the company will be low because they must pay high wages. But if the minimum wages is low, workers will be lazy to work that cause the supply of the workers low while the demand of the worker is high because of they just need to pay small amount of wages to the workers. For example, the minimum wages in Indonesia is 2.2 millions rupiah per month, we can say this is quiet low, so the demand of the worker is higher than the supply of the worker, this apply in Restaurant or Cafe in Indonesia, the number of worker is around 15 and there are still paper stick in front of the door which sound "need waiter/waitress". The second example, we take the case London (England), the minimum wages of the worker is quiet high, around 400 pound-sterling per month, almost 3 times the wages of the workers in Indonesia, so the supply is higher than the demand of the workers, this apply in Restaurant and Cafe in London, there are just around 6 workers. Second, government can make rules and regulation about the range of ages of the workers that allowable to work, in some country like Indonesia, the range of ages that allowed to work is between 15(for unskilled workers) (after graduated junior high school) to 65, because of this quiet wide range so the number of workers supplied are large enough, so it's not hard to find workers here. While in London to be permanent workers, the minimum age is 18 (after graduated senior high school, for unskilled workers) to 55 because of this quiet short age range, the supply of the worker is become lower than in Indonesia. But too low ages in working can cause many disadvantages, such as emotion problem, low education, early married, and etc. Third and the last is the rules and regulation about the insurance for the worker, especially for workers who's work in high risk jobs such as mining, with insurance, worker will be braver to work because they don't need to be worried much about their family if something happen to them(the miner) because of the insurance, so the supply of the workers in dangerous area become higher so it's become easier for the company to obtain the worker in that area.

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  14. Against the statement above, for some part of unskilled worker which is not yet educated about the government rules and regulation will not affected because of they don't know and understand about it, this kind of worker usually pay low because they are usually unskilled workers that just come from rural villages which don't know about the minimum standard wages for them. But this just happened to few non-skilled workers, and for generally ,government is the factor affected the supply and demand of the workers.
    The conclusion is in generally, government can affect the supply and demand of the worker by making rules and regulation about minimum wages, age ranges that allowable to work, and work insurances for workers, but there are still some few unskilled workers which not understand about the rules and regulation from the government so they won't affected.

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  15. Demand for labour is a concept that describes the amount of demand for labour that an economy or firm is wiling to employ at a certain time. This demand may not be necessarily be in long-run equilibrium, and is determined by the real wage firms are willing to pay for this labour, and the amount of labour workers are wiling to supply at that wage. The supply of labour is the total number of hours of work that the population is willing to supply.

    The demand and supply of labour can increase and decrease because of many reasons, and government intervention is one of them. Governments might intervene the demand or supply of labour if theres something wrong in the economy. For example, if a country has a big amount of citizens that are jobless, the government might intervene in a lot of ways, like decreasing the amount of tax on the workers or the income of the employer/firm. If a firm is charged with lower amounts of tax on their income, that means they have more money to pay higher wage rates and thus increases the supply of labour.

    Governments intervene with demand and supply of labour because of many reasons, such as, because there are too many jobless citizens, because many small businesses cant survive, and because they want the economy to have minimum number of poor people. Too many jobless citizens means the there are many people who strive hard to survive as they have a lack of money which, when seen from a developed country's view, looks bad and every government doesn't want to be seen that way, so they intervene to try to increase the number of people working.

    The supply curve can be influenced by government in many ways, which are minimum wage policy, amount of tax imposed on workers' income, subsidies on public services, employment legislation, and age restriction policy

    The supply of labour can increase if the government increases the minimum wage rate. A Minimum wage policy is the legally smallest amount of money that employers must pay into wages of their employees. As the government increases the minimum wage, all employers must pay more than before which causes previously jobless individuals to have more will in working or having a job which in turn increases the supply for labour. Most governments increase the minimum wage of their area every year to motivate more people to work but also limit it so small businesses can survive.

    The amount of tax imposed on workers' income can affect the supply for labour in an economy. Taxes are compulsory contribution to state revenue, levied by the government on workers' income and business profits. As the government decreases the tax imposed on workers' income, they can have more spare money and will be motivated to work more. But in reverse, if the government increases the tax on goods and services,the prices of it will increase which causes jobless individuals to begin searching for jobs for them to acquire the money needed to consume those goods and services.

    Subsidies on public services can affect the supply for labour too. Subsidies are the amount paid by the government on goods or services so that the selling price can be decreased to enable more consumers to purchase/use them. This is mostly used for public services and petroleum in Indonesia. How subsidies can affect labour supply is like this: as the Government subsidize petroleum more, the cost of traveling from a worker's home to his workplace will decrease which in turn causes them to be motivated to work.

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  16. Governments can use age restriction policies to influence the labour supply.
    If the government rises the minimum age for people to work from 15-60 to 18-60, the supply of labour will decrease as the individuals who are willing to work at the age 17 and below cant work. Although lowering the minimum age to work causes more labour supply, the young people are usually paid less as they are generally thought to be incapable of having skills an adult has.

    Employment legislation are the terms and conditions that must be followed by employers/firms if they want to employ a worker.Those terms and conditions include equal pay, sex discrimination, health and safety, benefits in work, and pension rights. The necessity of workers' employers to meet the legislation causes workers to be even motivated to work which increases the supply of labour.

    Besides the supply of labour, governments can influence the demand for labour too. The ways of them doing this are: tax imposed on employers' income, subsidies on the firms, taxes imposed on machines and equipment that replaces labour, and make a policy to attract foreign entrepreneurs to make businesses in the country, and employment legislation.

    The tax imposed on employers' income can affect the demand for labour. If the government deceases the tax, employers can have more money to be spent on hiring labour which in turn increases the demand of labour.

    Subsidies imposed on the firms are like how our government subsidize Pertamina, they do this for two reasons: one, they want poor citizens of Indonesia to be able to purchase petroleum to work. Second, they can make Pertamina to expand their business by making more gas stations which opens more job fields which causes the demand for labour to increase.

    An increase in taxes imposed on machines an equipments that replaces labour causes firms which produces goods to be discouraged from purchasing the machines. This causes less firms to purchase machines and more firms to open new job fields which increases the demand of labour.

    Governments can attract foreign entrepreneurs into making businesses in the country by making policies which lets them avoid paying taxes by making taxes free for them for 5 years, which in turn motivates them to make businesses in the country which opens new job fields and increases the demand for labour.

    Employment legislation are the terms and conditions that must be followed by employers/firms if they want to employ a worker.Those terms and conditions include equal pay, sex discrimination, health and safety, benefits in work, and pension rights. The necessity of meeting the legislation imposes additional costs on businesses which shifts the demand for labour to the left.

    In conclusion, the government has plenty of ways in affecting the supply and demand for labour and most of it works and helps the economy.

    Ivan alexander 8A

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  17. Governments have a lead power to intervene in labour market. The governments are the biggest employer in a country. They often employ many thousand number of labour in many sectors such as teachers, doctors, pilots, civil servants, police, etc. As a Major source of demand for labour, they are able to exert a big influence in the demand labour and supply labour. They are some government's action that influence labour market.

    Government influence
    •Government policy in a wide variety of areas has a significant influence
    •Influences the demand and supply of labour in direct or indirect ways
    •Increasing regulation of the labour market seen as being damaging by some
    •Businesses claim legislation and taxes depress the demand for labour

    Employment Legislation : equal pay, sex discrimination, disability, health and safety, benefits in work, pension rights.

    Government Intervention

    Unemployment benefits have an important influence on labour supply, especially for low income workers. If unemployment benefit is provided at too high a level then workers may opt to live on unemployment benefits rather than take up low-skilled (and low-paid) employment. A reduction in unemployment benefits may induce an increase in labour supply. However such a policy needs to be balanced against the need to provide a safety net for those who are unable to find work.

    Incentive Effects
    There are dangers in making the taxation system to progressive. Most people agree that income tax should be relatively progressive (those who are on higher incomes should pay a higher rate of tax than those on lower income as a form of redistributing incomes within a society and preventing inequality from extremes). However there comes a point where the tax rates are so high that a large proportion of additional is taxed away, reducing the incentives for individuals to supply additional effort or labour. This may result in a shift from highly skilled, highly paid jobs.

    Minimum Wage

    The market for labour shows an example of government intervention in the form of minimum prices. This is known as the national minimum wage (NMW) were every worker has to be paid a certain wage.

    If the NMW was to be lowered then there would be an increase in the quantity of labour demanded but at a lower wage.






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  18. Trade unions are associations of workers that negotiate with employers on the pay and working conditions of members of the union. Trade unions have 3 major objectives; wage bargaining, improvement of working conditions and the security and health of their members.

    There are 2 ways in which a trade union may seek to affect labour market equilibrium. It may limit the supply of workers into an occupation or industry (you may legally have to be a member of a certain union to enter a profession). Also it may negotiate for higher wages for its members.

    Restricting Labour Supply

    The graph to the left is a normal labour graph for a firm. However if the firm is facing a trade union that limits the amount of labour into the market then the unions will be able to artificially push the wage up.

    In this situation the union is effectively trading off higher wages for its members, against a lower level of employment. The people that aren’t a member of the union, but would be happy to supply their labour, can’t (as they are not a member of the compulsory union) and so remain unemployed, imposing a cost on society.

    The extent of the trade off depends on the elasticity of demand for labour. When demand for labour is more elastic the wage increase is lower, whereas with inelastic demand for labour the wages rises more than that of elastic demand for labour.

    Negotiating Wages alternatively a trade union can attempt to negotiate higher wages for its members. If .they succeed then the wage will be higher but the level of unemployment will be also higher as the firm hires less labour.

    Job Security Workers will have more job security if they are a member of a union as the union will take legal action. From a firms point of view this can lead to an increase in motivation as workers feel secure and this leads to an increase in productivity.

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