function in that it depends on v linked, however. Indeed, the ntity choices of the household Figure 8.2. Indifference curves of the union level of employment L, the level of profit is increased if the wage rate falls, i.e.

thr/dw = 7rw < 0. Hence, the level of profit increases the further down the demand for labour curve the firm operates, i.e. 70 < Trl < 72.

Trade union behaviour can also be represented graphically. The third schedule to be derived concerns the union's indifference curve. Obviously, the union will not supply any workers to the firm at a wage rate below the unemployment benefit.