When the answers change, I change my thoughts. ChatGPT scored poorly on my Fall, 2022 Labor Economics midterm. A D, to be exact. To my shock and no small dismay, GPT-four bought an A. It earned 73/100, which would have been the fourth-highest rating on the check. Probably the most pure rationalization to my mind was that my blog post made it into the brand new training data, but multiple knowledgeable mates assure me that there isn't any new coaching knowledge. I wouldn’t have been surprised by a C this yr, a B in three years, and a 50/50 A/B mix by 2029. An A already? Base rates have clearly failed me. I’m not conceding the bet, because I nonetheless think there’s a 10-15% probability I win through luck. But make no mistake, this software program truly is the exception that proves the rule. Here are the outcomes, with commentary. State whether or not every of the next six propositions is true or false. In 2-3 sentences, explain why.
Use diagrams if helpful. 1. Suppose a country’s workplaces begin to experience periodic blackouts. T, F, and Explain: Aggregate Labor Demand will clearly fall despite the fact that some workers will benefit. TRUE. ALD will definitely fall as a result of MPP is the sole trigger of MVP on the aggregate stage, and employees are much less productive with intermittent electricity. P, and P will rise more than MPP falls. Electrical repairmen are an obvious example. True. Aggregate Labor Demand will probably fall in response to periodic blackouts. This is because blackouts disrupt the normal functioning of workplaces, leading to decrease productiveness and effectivity. While some workers could expertise temporary benefits equivalent to diminished working hours, the overall damaging impression on the economy and labor demand will possible outweigh these individual positive factors. Score: 6/10. GPT-four obtained the primary idea proper, however didn’t identity workers in industries with inelastic product demand as the important thing beneficiaries. T, F, and Explain: Krugman argues that such employment loss is a market failure that justifies government regulation.
FALSE. According to Krugman, employment will fall in some sectors, however rise in others. The net result of upper productivity, as common, is that residing standards rise general, though not everyone good points. See his hotdog/bun thought experiment. False: Krugman doesn't argue that employment loss resulting from productivity progress is a market failure that justifies authorities regulation. Instead, he means that this phenomenon is a natural consequence of technological progress and market dynamics. The assertion highlights the truth that productiveness development can result in labor-saving improvements, which can reduce the need for human labor in a given sector. However, Krugman does not imply that this requires authorities intervention. Score: 10/10. That’s precisely what Krugman said. 3. Suppose the government begins licensing car mechanics, however this fails to lift the quality of their work. T, F, and Explain: Mechanics’ wages will certainly rise. TRUE. Licensing reduces supply, which raises wages and reduces amount. If licensing raised high quality, demand would go up, too. But by assumption, that didn’t happen. And if it did, it will only reinforce the conclusion that wages go up! False: If the federal government begins licensing car mechanics but this fails to lift the quality of their work, it is not assured that mechanics' wages will definitely rise. While licensing can restrict the supply of mechanics by creating entry barriers, wages will not essentially increase if the quality of work stays unchanged. Consumers could also be unwilling to pay greater costs for the same quality of service, and the demand for mechanics might remain stable and even decrease if the public perceives the licensing as ineffective. Score: 3/10. The AI fails to apply primary provide-and-demand. Since high quality at least does not fall, falling supply and non-falling demand ensures higher wages for mechanics.