One view believes that the labor supply is inelastic; the opposing view believes that the labor supply is elas

Question

One view believes that the labor supply is inelastic; the opposing view believes that the labor supply is elastic. Which view is right?

Answer 1

For an individual it is inelastic vs wages.Many people would even work less if wages increased (people holding second jobs or working over time to make ends meet). For the labor force as a whole it is hard to measure because the number of people who are willing to work at existing wages, but can't find jobs (unemployed). Wages tend to increase when the unemployment rate goes down, so it is hard to separate the two effects. There is also the effect of relative wages. The decision of how much to work depends on your after tax wage relative to wages of household help that you would hire to make time for paid work.