Protection Questions (1 Viewer)

[iStudent]

Just to make a note - you should instantly cross off C (for your first Q) because structural employment/unemployment is not a short term impact... (I think??? Or is my memory failing me again)

 

[RecklessRick]

Or is my memory failing me again

Sorry mate, must be your memory. Structural unemployment is unemployment accrued as a result of the mismatch between labor skills and the skills required by industry. In this context, this mostly refers to labor skilled up in inefficient industries which then fail (resulting in unemployment) in contrast with the skills required by competitive industries. For example, if the car industry failed, you'd have a bunch of structural unemployment because the labor is skilled in manufacturing, when efficient industries require mining skills. This particular type of unemployment only occurs in the short term however. Into the medium/long term, there is an increase in employment in efficient industries (for example through the structurally unemployed re-skilling), reducing unemployment. This question is asking about the results of a reduction in protection, meaning that whatever inefficient industry (let's say the car industry) is no longer being propped up by government subsidies to the same extent, resulting in structural unemployment, which is short term. Ergo the answer is c.

Explanations of unemployment as a result of a decrease in protection can be found on page 23 and 25 of Dixon and there's a good diagram on page 149 for long vs short term factors if there's any confusion. 150 and 151 address the issue of structural unemployment most specifically.

 

[iStudent]

Sorry mate, must be your memory. Structural unemployment is unemployment accrued as a result of the mismatch between labor skills and the skills required by industry. In this context, this mostly refers to labor skilled up in inefficient industries which then fail (resulting in unemployment) in contrast with the skills required by competitive industries. For example, if the car industry failed, you'd have a bunch of structural unemployment because the labor is skilled in manufacturing, when efficient industries require mining skills. This particular type of unemployment only occurs in the short term however. Into the medium/long term, there is an increase in employment in efficient industries (for example through the structurally unemployed re-skilling), reducing unemployment. This question is asking about the results of a reduction in protection, meaning that whatever inefficient industry (let's say the car industry) is no longer being propped up by government subsidies to the same extent, resulting in structural unemployment, which is short term. Ergo the answer is c.

Explanations of unemployment as a result of a decrease in protection can be found on page 23 and 25 of Dixon and there's a good diagram on page 149 for long vs short term factors if there's any confusion. 150 and 151 address the issue of structural unemployment most specifically.

Yep, you're right. My bad! Got those mixed up.

I thought there was something wrong, lol