Select the appropriate production method from wage and machinery costs, the nature of the product and required scale, then evaluate consequences for firms, workers and the economy.
Washington State is the state which grows the most apples in the US. In 2019, apple production increased in Washington State but the market was in disequilibrium. Apple farming is a labour
intensive industry because apples are picked by hand. The market for apples in the US is competitive.
Analyse how labour-intensive production can benefit an economy.
Analyse how labour-intensive production can benefit an economy.
Coherent analysis which might include:
Labour-intensive production uses a high proportion of labour (1) it may increase employment (1) lower unemployment (1) raise incomes (1) raise standard of living / reduce poverty (1).
The country may have a large supply of labour (1) the labour force may be relatively unskilled (1) which is cheap to employ / cheaper than using capital (1) saving money for firms (1) more flexible than capital in adjusting supply (1) less pollution / more environmentally friendly (1).
Labour-intensive production may provide individually made products / handcrafted / higher quality (1) raise skills level of workforce (1) may be in high demand internationally (1) increase exports / reduce deficit on current account balance (1).
6
This is a static analysis so do not reward answers that write about higher government revenue and expenditure and rise
in total demand and economic growth.