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Figure 2.18: Lorenz Curve for a Segmented Labour Market
This model economy's income distribution is depicted using a Lorenz curve. The horizontal axis represents the cumulative percentage of the population, ordered from lowest to highest income, while the vertical axis shows the cumulative percentage of total income. A straight line from (0,0) to (100,100) serves as the benchmark for perfect equality. The Lorenz curve for this segmented labor market is plotted through the points (0,0), (10,0), (50,10), (90,60), and (100,100). The population segments along the horizontal axis are defined as follows: the first 10% are unemployed, the next 40% are secondary market workers, the subsequent 40% are primary market workers, and the final 10% are owners. This distribution results in a Gini coefficient of 0.52.
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Introduction to Macroeconomics Course
Ch.2 Unemployment, wages, and inequality: Supply-side policies and institutions - The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
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Primary Labour Market
Secondary Labour Market
Income Disparity Between Primary and Secondary Labour Markets
Figure 2.18: Lorenz Curve for a Segmented Labour Market
Effect of Eliminating Labour Market Segmentation on Wages and Inequality
Homogeneity of Owners in the Segmented Labour Market Model
Union Influence on Labour Market Segmentation and Inequality
Union Reinforcement of Labour Market Segmentation
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