| Chapter 16 Outline |
| IV. CAPITAL ACCUMULATION, TECHNICAL PROGRESS, AND THE DEMAND FOR LABOR |
| A. General Comments |
| 1. Capital accumulation and technical progress (including technical efficiency change) generally increase the demand for labor. |
| B. Real Wage and Productivity Growth |
| 1. Increases in the capital-labor ratio and technical change have not resulted in large enough increases in labor demand to offset the increased labor supply and push up the real wage. |
| a. The collapse of labor productivity growth helps to explain why increases
in labor demand have not kept pace with increases in labor supply. |
| 2. Real family income is up despite the fact that the real wage has been almost constant. |
| a. An important reason for the increase in real family income is women's
increased participation in the labor force. |