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The Substitution Effect (In the Work-Leisure Model) Induces a Person

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The substitution effect (in the work-leisure model) induces a person to work less in response to higher wages,which tends to make the labour supply curve slope upward.


Definitions:

Quantity Supplied

The amount of a good or service that producers are willing to sell at a given price over a specified period.

Supply

The total amount of a product or service that is available to consumers at a given price.

Supply Curve

A visual chart that illustrates the connection between a good's price and the amount of it producers are ready to offer.

Aluminum

A silvery-white, lightweight metal, it's the most abundant metal in the Earth's crust and is used in a vast array of products from cans to airplanes.

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