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In this programme Professor Brooman considers the distribution of incomes between the various factors of production. He explains differences of reward to factors by considering the demand for, and ...the supply of, the factors. He goes on to what affects the and supply for man power (i.e. labour) in a given industry. He then puts the two together to give theoretical explanation of how wage rates levels may be determined. The programme finishes with discussion of the general level of wage rates, and the generalisation of the above theory to the other factors of production.
Metadata describing this Open University video programme
Module code and title: D100, Understanding society: a foundation course
Item code: D100; 16
First transmission date: 02-05-1971
Published: 1971
Rights Statement: Rights owned or controlled by The Open University
Restrictions on use: This material can be used in accordance with The Open University conditions of use. A link to the conditions can be found at the bottom of all OUDA web pages.
Duration: 00:14:56
Note: See D100 16+PS for programme
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Producer: Alan Hancock
Contributor: F S Brooman
Publisher: BBC Open University
Keyword(s): Manpower; Supply and demand
Footage description: Brooman introduces the unit. He will discuss inequalities of income caused by differences in returns people get from their esources. Supply and demand graph showing price of service: of various factors based on relative strength of supply and demand. (this graph is from unit 12) Brooman changes the axis of the graph to man - hours x rate of remuneration. He thus can measure supply and demand of labour. What determines the supply and demand for labour Brooman takes a hypothetical industry in which amount of capital equipment and methods of production are fixed. Only the amount of labour is varied. On a graph he plots a curve showing relationship between total input of labour and total commodity output. As labour input increases so output increases but there are diminishing returns. The graph shows the marginal product. This gets smaller as labour input increases. The marginal product is plotted on another graph to demonstrate this point. On this graph the optimum profitable level of employment from the employers point of view is shown based on two units of output for every man hour worked. The graph also shows his profit at any level of employment. The graph next shows the effect on the employers profit of higher (three units per man-hour) and lower ( one unit per man hour ) wages. The marginal product curve tells the amount of labour the employer will be able to take on profitably and so is a demand curve for labour. Money values replace units of commodity on the graph and the marginal product curve refers to actual wage values. "The supply side of labour is examined on a graph, A labour supply curve is plotted. It is an upward sloping curve - as wages increase in an industry so more workers will want to be employed there. The effect of union rate is examined. The labour supply and demand curves are plotted together. The intersection of the curves shows the equilibrium wage rate. Brooman introduces supply and demand curves for labour as a whole. The graph shows the wage rate for labour as a whole where the supply of labour balances against the demand for it. The application of supply and demand curves for other factors of production such as capital is discussed. Brooman discusses other factors bearing on the distribution of income between individuals. Credits.
Master spool number: 6HT/70179
Production number: 00520_1216
Available to public: no