Author Question: What impact do you think that the movement of women from working in the household to working in the ... (Read 60 times)

awywial · **on:** Jun 30, 2018

What impact do you think that the movement of women from working in the household to working in the market has had on GDP? Why? Do you think that this points to a problem with GDP?

What will be an ideal response?

Question 2

Explain how an increase in the public's taste towards less leisure would affect the labor market, the production function, and aggregate output. Provide graphs to illustrate.

What will be an ideal response?

cici · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

By moving to the market, women's work is now counted in GDP while it was excluded before. This does point to an important omission in GDP. However, household production has not been included in GDP because of the difficulty in finding prices for these activities.

Answer to Question 2

An decrease in the demand for leisure would shift the labor supply curve to the right (up), which would decrease the real wage and increase the quantity of labor. This increase in the quantity of labor would lead to a movement along the production function towards higher output.