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2010-04-23
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Suppose the market for plumbers was in equilibrium at a wageof $150 per hour and a quantity of 1,500 plumbers employed.A union comes to town and 1,000 of theplumbers join.The union requires theplumbers to charge at least $200 per hour because the union backs their work,provides additional training, and certifies that plumbers will work reliablehours.People in the community are mixedin their views of whether unions workers are more productive than non-unionworkers.Draw the supply and demand curves for 1.The market before the union arrived.2.The market for union plumbers.3.The market for non-union plumbers.Explain your graphs and state any assumptions that you make.
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