For faster navigation, this Iframe is preloading the Wikiwand page for
Hicks–Marshall laws of derived demand.
In economics, the Hicks–Marshall laws of derived demand assert that, other things equal, the own-wage elasticity of demand for a category of labor is high under the following conditions:
- When the price elasticity of demand for the product being produced is high (scale effect). So when final product demand is elastic, an increase in wages will lead to a large change in the quantity of the final product demanded affecting employment greatly.
- When other factors of production can be easily substituted for the category of labor (substitution effect).
- When the supply of other factors of production is highly elastic (that is, usage of other factors of production can be increased without substantially increasing their prices) (substitution effect). That is, employers can easily replace labor as doing so will only moderately increase other factor prices.
- When the cost of employing the category of labor is a large share of the total costs of production (scale effect)
The "Hicks–Marshall" is named for economists John Hicks (from The Theory of Wages, 1932) and Alfred Marshall (from Principles of Economics, 1890).
{{bottomLinkPreText}}
{{bottomLinkText}}
This page is based on a Wikipedia article written by
contributors (read/edit).
Text is available under the
CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.
Hicks–Marshall laws of derived demand
{{current.index+1}} of {{items.length}}
Thanks for reporting this video!
This browser is not supported by Wikiwand :(
Wikiwand requires a browser with modern capabilities in order to provide you with the best reading experience.
Please download and use one of the following browsers:
An extension you use may be preventing Wikiwand articles from loading properly.
If you're using HTTPS Everywhere or you're unable to access any article on Wikiwand, please consider switching to HTTPS (https://www.wikiwand.com).
An extension you use may be preventing Wikiwand articles from loading properly.
If you are using an Ad-Blocker, it might have mistakenly blocked our content.
You will need to temporarily disable your Ad-blocker to view this page.
✕
This article was just edited, click to reload
Please click Add in the dialog above
Please click Allow in the top-left corner,
then click Install Now in the dialog
Please click Open in the download dialog,
then click Install
Please click the "Downloads" icon in the Safari toolbar, open the first download in the list,
then click Install
{{::$root.activation.text}}
Follow Us
Don't forget to rate us
Oh no, there's been an error
Please help us solve this error by emailing us at
support@wikiwand.com
Let us know what you've done that caused this error, what browser you're using, and whether you have any special extensions/add-ons installed.
Thank you!