If the market for tea workers is competitive, explain how a union can influence the wage rate
Question:
If the market for tea workers is competitive, explain how a union can influence the wage rate and employment. Draw a graph to illustrate your answer.
Sri Lanka’s workers want a daily wage rate of 1,000 rupees. In January, trade unions and tea plantations negotiated an increase in the wage rate by 40 percent to 700 rupees a day. Academics say that even 1,000 rupees a day is less than what workers need to live.
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In a competitive market the wage rate and employment levels are typically determined by the market forces of supply workers willing to work and demand ...View the full answer
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