When labour productivity increases, the demand for labour curve ________ and the supply of labour curve ________.

Question

Quizplus · Accepted Answer

When labor productivity increases, firms are willing to hire more workers at each wage level because each worker is more productive, shifting the demand for labor curve rightward. The supply of labor curve does not shift because productivity changes do not directly affect workers' willingness to work at different wage levels.

When Labour Productivity Increases, the Demand for Labour Curve ________