This document contains a set of questions for practise for the exam based off past papers questions, with both plans and full essays. This document is very helpful to achieve a high mark in the EC307 end of year exam.
EC307: Macroeconomics Policy In The EU (EC307)
All documents for this subject (2)
2
reviews
By: jay21 • 5 months ago
Would definitely recommend.
By: tejassridhar84 • 6 months ago
Seller
Follow
bspurs11
Reviews received
Content preview
EC307 QUESTION BANK
TOPIC 3: THEORY OF OCA: LABOUR MARKETS
Summer Exam 2021
How might collective wage bargaining have an impact on economic outcomes in sectors
that are affected by economic integration? (20 marks)
Initial equilibrium at collective wage bargaining: for every labour hour worked, through
bargaining power, collective bargaining curve (CS) lies strictly above individual supply
curve (IS), this means higher wages
Problem at initial equilibrium: at this higher wage, there is an imbalance of supply and
demand and many people are willing to supply more hours of work than at the
equilibrium -> this leads to unemployment between L’ and L
If there is trade integration without worker mobility and wages are set collectively above
market level
There is a rise of wages in expanding sector
, - Relevant labour supply curve continues to be CS (institutional structure remains
after expansion)
- Continued unemployment between L and L’
- Compared to initial point: Increase in wage, increase in employment, no change
on unemployment (distance is the same if we assume linear and parallel curves)
Fall in wages in declining sector
- Assumption of downward rigidity: possible that wage is sticky at w, increase in
unemployment L2-L1
Overall wage inequality can rise or fall depending on whether the now-expanding
sector had higher wages to begin with
No clear effect on unemployment overall, but if there is downward rigidity there
will be an increase in unemployment in the shrinking sector
Summer Exam 2020
, In a model of collective wage bargaining, how might economic integration affect
unemployment and wage inequality in i) an expanding sector, and ii) a shrinking sector?
Include diagrams as illustration in your answer.
(20 marks)
See above
Presentation topic
Relative to the UK and the US, the Eurozone exhibited significant persistence in the rate
of unemployment in the aftermath of the financial crisis. What might explain this
divergence? Is it due to labour market rigidities in the Eurozone hampering the
economy’s ability to respond to external shocks; is it a failure of fiscal policy; or does the
answer lie elsewhere?
TOPIC 4: THEORY OF OCA: COSTS OF COMMON CURRENCY
TOPIC 5: THEORY OF OCA: BENEFITS OF COMMON CURRENCY
Summer Exam 2021
How might exchange rate uncertainty benefit a firm with a relatively relaxed attitude to
risk? Explain carefully the assumptions you’re making. (20 marks)
Benefits of OCA: 3. Exchange rate uncertainty
- Price certainty (fixed exchange rates)
- Price uncertainty: price fluctuates symmetrically between P2 and P3
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller bspurs11. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $21.61. You're not tied to anything after your purchase.