An increase or shift out in the supply of a factor such as the one shown from S₁ to S₂ will lead to a reduction in wages and an increase in numbers hired.

The supply of labor to a particular occupation shifts out in the long run for several reasons. If training for the occupation becomes easier to obtain, if the occupation increases in social status, if work conditions associated with the occupation improve, essentially anything which could make the occupation more desireable apart from the actual wage.

Copyright © 1995-2004 OnLineTexts.com, Inc. - All Rights Reserved