The material which is read this week applies to my personal and professional life to a greater extent. Considering the topic of economic rent, being a tenant I have personally experienced that the rent of the houses in the most desired and demanded locations is high. This is exactly I accordance with the economic rent principle which also describes that rent is high because of the high final product demand and the derived demand. Further, in my professional life I have experienced that that there is employee discrimination in a way that women are paid less than men, also they are not given preference in certain jobs. Same is the case with the minorities residing in the country. Moreover, I also noticed that productive workers i.e., workers having professional degree, experience, training, and natural talent are given more preference and are paid more than the less productive workers.
The reading material has introduced the theory of dual labor market, which is a new concept for me. it has changed my thinking about the labor market and made it easy for me to understand the labor market by dividing it into primary labor market and secondary labor market. I come to know that the market in which there are better employment opportunities with better wages, benefits and incentives is a primary labor market whereas the low paying, temporary employment providing market is the secondary labor market. This concept is useful because understanding and having idea about the nature of bad and good job is significant for understanding the concept of unemployment (Saint-Paul, 1996).
Further, the concepts can be applied in a different way in personal and professional life. Considering the stick approach and the carrot approach, the stick approach represents that fear in the professional life such as fear of job loss, loss of the income, demotion, bonus reduction and other fines or penalty, which also affects the personal life. The person feel discouraged due to these but he/she can’t do anything because if he/she does not work he/she does not eat. But in my personal and professional life this proves to be a blessing because the penalty is also imposed on the executives of the organizations if they do not remain fair to their subordinates. This has enabled social and economic well-being of the subordinates in the organization, which motivated me to work effectively and to achieve organization’s goals. Further, the carrot approach is also useful in the personal and professional life. in my organization, carroty approach i.e., money is given in the form of bonuses or pay for motivating employees but only to the employees that perform their work efficiently and attain their targets which is quite motivational for the hardworking employees.
Saint-Paul, Gilles. (1996). Dual Labor Markets: A Macroeconomic Perspective. Massachusetts Institute of Technology Press, USA.