State any three factors that affect the size of labour force
Answers
Factors Influencing the Labor Force
Population: As expected, population increases result in labor force increases. Both the strength of the influence and the magnitude are strong. A one percent increase in state population results in a 0.74 percent increase in labor force size.
Income: As state incomes grow, it attracts labor force entrants hoping to take advantage. However, a state’s cost of living is shown to have no influence on labor force size and is not statistically significant.
Educational Attainment: A more educated society has a larger labor force.
Homeownership: A higher homeownership rate is associated with a slightly smaller labor force. This is likely due to reduced employee mobility since a dynamic labor force would also be mobile. Homeownership likely reduces this mobility and thus negatively impacts labor force size. Homeownership has many benefits for society, but this is one negative tradeoff.
State-Specific Influences: The state binaries are generally positive and indicate a statewide influence regarding labor force size. Without further data, teasing out state-specific causes is problematic. The purpose of the binary is simply to recognize these potential influences and control for them.
Answer:
ExplanationI