wage differentials3

• In what context does the video discuss regional wage variances?

  The north-south divide in the UK
• What fact is proven about average wages in the UK?

  Average wages in the north are lower
• What is the biggest divide in the UK?

  Divide between London and the rest
• What economic event contributed to the north-south divide?

  Restructuring of the UK economy
• When did the UK economy begin restructuring?

  Especially since the 1970s
• What did the UK economy specialize towards during restructuring?

  Specializing in Services especially financial services
• Where are many Financial Services jobs located in the UK?

  London
• Where were the manufacturing and heavy industry jobs primarily located?

  In the north
• What happens to mrps in the north as the economy restructures?

  They're going to be much much lower
• What is the effect of lower demand on the mrp of northern workers?

  The marginal revenue product is much lower
• What happens to the mrps of service industry workers?

  Their mrps are going to be much higher
• What is the effect of higher mrp on wages for service workers?

  They can demand much higher wages
• What is the consequence of higher service sector wages?

  Massive Regional variance in wage
• What is the cause of the negative multiplier effect up north?

  The Fallen decline of the manufacturing sector
• How does unemployment in declining industries affect regional economies?

  Less money spent in their Regional economies
• What happens to industries dependent on spending from manufacturing workers?

  See a fall in demand
• What type of demand is labor considered to be?

  Derived demand
• What happens to workers in dependent industries due to falling demand?

  They May therefore become redundant
• What can further ripples in the regional economy lead to?

  More unemployment
• What does more unemployment lead to?

  A large wage variants
• What happens in areas with high demand for workers?

  Wages are therefore pushed up
• How does increased spending in high-demand regional economies affect job creation?

  Creates more jobs
• What happens to the wage variance when there is high demand?

  See that variance get greater
• What is the negative accelerator effect?

  Firms are not willing to invest
• What does falling regional economy growth rate reduce?

  Wage growth potential
• What do you see in service sector areas?

  Positive investment large job creation
• What does prosperity lead to?

  Regional variance worse
• What two types of immobility exist in the north?

  Occupational and geographical
• What is occupational immobility?

  Workers don't have the skills
• What is geographical immobility?

  Not willing to move location
• What can cause geographical immobility?

  They've got Family Ties
• What kind of workers migrate south?

  The most productive workers
• What does the emigration of the most productive workers lead to?

  Leaves behind the lowest paid workers
• What effect does leaving behind the lowest paid workers have?

  Makes the regional variance worse
• What does the video discuss in terms of variances?

  General reasons why there might be
• True or false: Average wages in the north of the UK are generally higher than in the south.

  False
• What type of demand is labor classified as in economics?

  Derived demand