Which of the following would cause a rightward shift of the demand for labour:
Answers
Answer:
Consider first a rightward shift in Demand. This could be caused by many things: an increase in income, higher price of a substitute good, lower price of a complement good, etc. Such a shift will tend to have two effects: raising equilibrium price, and raising equilibrium quantity.
A rightward shift in the demand for labours can be caused by many factors like an increase in the number of industries, an increase in the demand for a particular good, government policies, an increase in wages of the workers, etc.
A rightward shift in the curve indicates an increase in the demand. For a rightward shift in demand for labours we need factors which attract more labours.
Setting up of new industries can lead to the increase in demand as new factories will need labours to work in it.
Similarly other factors like increase in the wages of the improvement in the working conditions of the labours can attract more labours and this will lead to a rightward shift in the demand for labours.