Labor Demand
The consumers of the labor market are firms. The demand for labor services is a derived demand, derived from the supply and demand for the firm's products in the goods market. It is assumed that a firm's objective is to maximize profit given the demand for its products, and given the production technology that is available to it.
Some notation:
Let be price level of commodities Let be nominal wage Let be real wage (w/p) Let be profit of firms Let be labor demand Let be the firms output of commodities that it will supply to the goods market.Read more about this topic: Classical General Equilibrium Model
Famous quotes containing the words labor and/or demand:
“Labor came to humanity with the fall from grace and was at best a penitential sacrifice enabling purity through humiliation. Labor was toil, distress, trouble, fatigue—an exertion both painful and compulsory. Labor was our animal condition, struggling to survive in dirt and darkness.”
—Shoshana Zuboff (b. 1951)
“That demand of a given moment,
the will to enjoy, the will to live,
not merely the will to endure,
the will to flight, the will to achievement,
the will to rest after long flight.”
—Hilda Doolittle (1886–1961)