Mine Hazard Report
The question
The competitive labor market for copper miners in the district of Vandrell is in equilibrium. A government study, accepted as accurate by everyone in the district, reports that years spent underground in these mines cause a serious and irreversible lung disease. Assume the world price of copper, miners' productivity, and the safety equipment the mines actually use are unchanged. Show the effect on the labor market for copper miners. Show the effect on the Labor Market graph.
Drag a curve, or use the arrow buttons. Want the free-play version with every control? Open this graph in the sandbox.
Mine Hazard Report: the worked answer
On the Labor Market graph, Labor supply (SL) shifts left.
Why Labor supply (SL) shifts left
Non-wage characteristics of a job are a determinant of labor supply, and learning that the work causes serious illness makes mining less attractive at every wage. Fewer people are willing to take the job at any given wage, so the labor supply curve shifts to the left. The world copper price and miners' productivity are unchanged, so each miner's marginal revenue product is unchanged and the labor demand curve does not move.
What happens to the equilibrium
The equilibrium market wage rises and the level of employment decreases.
The mistake students make on this one
Students frequently shift labor demand left, assuming bad news about an industry must hurt the firms. The mines can still sell copper at the same world price and each miner still digs the same amount, so MRP is untouched; the news changed only what workers require to accept the job.
On exam day
This is the compensating differential: unpleasant or dangerous jobs pay MORE precisely because labor supply to them sits farther left, so a rising wage on your graph confirms the answer rather than contradicting it.
How this is graded
The checker reads every curve's position before and after your answer. You are marked correct only when Labor supply (SL) shifts left and every other curve on the Labor Market graph stays where it started — the same standard an AP reader applies to a drawn graph: the right shift, and nothing extra. There is no AI involved; the rubric is the geometry.
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