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Population Size and Income per Capita


Discuss whether an increase in a country’s labour force will increase income per head.


Labor Market and Income Distribution

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I. 🍃Introduction
- Definition of labour force
- Importance of labour force in economic growth

II. Reasons why a larger labour force may enable economic growth
- Division of labour/specialisation
- Economies of scale
- Reduced average costs of production
- Increased sales and output
- Reduced dependency ratio

III. Reasons why a larger labour force may not enable economic growth
- Population growth exceeding labour force growth
- Lack of demand for labour
- Decline in labour force quality
- Increased competition in labour market

IV. 👉Conclusion
- Importance of balancing labour force growth with other economic factors
- Need for policies to address potential negative effects of labour force growth.

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