The supply curve of labor to industry in the Lewis model is horizontal if there is surplus labor in agriculture.This condition persists as long as
A)the marginal product of labor is less than the average product of labor in agriculture.
B)the marginal product of labor in agriculture is less than the marginal product of labor in industry.
C)there are diminishing returns to labor in agriculture.
D)the marginal product of labor in agriculture is zero.

Question

Quizplus · Accepted Answer

The supply curve of labor to industry in the Lewis model is horizontal when there is surplus labor in agriculture, which persists as long as the marginal product of labor in agriculture is zero. This means that adding more labor to agriculture does not increase output, indicating a surplus of labor.

The Supply Curve of Labor to Industry in the Lewis