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Chapter 17: Problem 13

During the \(1970 \mathrm{~s}\), many women changed their minds about whether they would leave the labor force after marrying and having children or whether they would be in the labor force most of their adult lives. In 1968 , the National Longitudinal Survey asked a representative sample of women aged 14 to 24 whether they expected to be in the labor force at age \(35 .\) Twenty-nine percent of white women and 59 percent of black women responded that they expected to be in the labor force at that age. In fact, when these women were 35 years old, 60 percent of those who were married and 80 percent of those who were unmarried were in the labor force. In other words, many more women ended up being in the labor force than expected to be when they were of high school and college age. What effect did this fact have on the earnings of these women? Briefly explain.

Short Answer

Expert verified
The increase in the number of women in the labor force, based on the principle of supply and demand, could have led to lower wages if demand remained constant. However, the exact effect on female earnings cannot be definitively stated without considering other potential influencing factors or empirical data.

Step by step solution

01

Understanding the scenario

Recall that in the 1970s, the number of women who were in the labor force was higher than anticipated from the survey done in 1968. This meant there was an increase in the supply of labor as more women were available to work than initially expected.
02

Apply principle of supply and demand

In economics, when supply is high and demand remains the same, it often leads to a decrease in price. In this scenario, the ‘price’ is the wages earned from labor supplied. The increase in labor supply may have led to lower wages (assuming demand remained constant).
03

Consider other factors

While the principle of supply and demand suggests that the increase in women laborers would lead to lower wages, other factors should also be considered. Technological developments or an increase in demand for labor could counteract this effect and increase earnings.
04

Conclusion

Based strictly on the principle of supply and demand, an increase in women joining the labor force during the 1970s could have potentially led to lower wages. However, various factors such as changes in technology, the type of work, education level, and the demand for labor could offset this general economic assumption. Therefore, it is not possible to definitively say how the changing labor force demographics affected women's earnings without further empirical data.

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Most popular questions from this chapter

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