Other Causes of Labour Market Failure

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    Other Causes of Labour Market Failure

    • Attachment between workers and employment
      • Some workers may stay in less paid jobs because they like working for their employers (transfer earnings?)
      • This attachment reduces the mobility of labour and makes supply more inelastic
        • It may, however, increase productivity.
      • Inertia
        • Workers may not move to higher paid jobs and employers may not seek for more productive staff simply because they can’t be arsed.

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