GT4-CLIL Booklet A by louisfndo

Student booklet

THE HISTORY OF MONEY 1. SUMMARY •

Do you know what “bartering” is?

•

When was the idea of coins first introduced?

•

Did you know that salt was used as “money” in the past and that the Chinese were the first to use paper money? In this task, students will learn about the history of money and all its forms.

2. KEY CONTENTS 2.1. The history of money: items used as a form of money in the past; symbols stamped in coins; first people to use paper money.

Read the text and complete with the phrases from the box. became the first coins in history

the first ‘bankers’

making paper money

many treasures

doing business

protected by law

in the Greek markets

type of exchange

picture stamped on it

to be very heavy

GT4 | Unit 10 | Student booklet

THE HISTORY OF MONEY BARTERING Money is just a form of exchange: you have something I want and I have something you want. We can discuss how to do the exchange. For example, is what I have more valuable than what you have? Discussing this exchange is called bartering. Bartering has been in existence from the beginning of human interaction and was a way of (1) __________________. About 3,000 years ago, people started using objects, such as tools, spears, arrowheads, stone axes, animal skins, salt, colored beads, shiny stones or animals. When it was discovered that salt was desired and needed in faraway countries, people who had access to salt mines and salt lakes would pack the dried salt on camels. They would then travel hundreds of miles across the deserts to ports along the Mediterranean to sell the salt to shippers. This (2) _______________ can still be found amongst tribes in lesser civilized areas throughout the globe, like parts of Africa or the Amazon jungle. There are still some groups of people who give cows, sheep, and chickens as a gift from the bride’s parents to the intended groom. It is most likely that this is the origin of the giving of gifts at weddings and other ceremonies. The Aztecs of Mexico used little dolls made of gold. The ancient Egyptians and the ancient Celts in Ireland used little metal rings made of bronze, copper or gold, and often wore their wealth as ornaments. Ancient peoples all over the world tried using different things: rice, bread, chocolate, beans, or corn. This did not work that well, as these products were often eaten. What was needed was something that other people wanted or agreed on the value, could be carried easily, and was strong enough to withstand being passed from person to person to person, perhaps thousands of times. METAL COINS It is believed that the idea of metal coins started in ancient Turkey about 2,700 years ago. These discs were small, round and flat and made of gold or silver. Whatever the disc was worth had a (3) __________________. At about the same time, the Chinese started making tiny bronze miniatures of tools, arrows, daggers, and weapons.

A pocketful of these spiky, sharp things was not convenient to carry even though they were small. These items were changed into little circles of bronze with perhaps a stamped image on them, each image depicting a different item and a different value. For example, five discs with arrows might equal one disc with a dagger on it. These discs (4) __________________. They also stamped a small hole in the middle of the coin so that the coins could be strung together and worn around one’s neck. The people in ancient Greece, a neighbor and trader with Turkey, started doing the same thing. Each city-state had its own version of the coin and had banks where foreign coins could be exchanged for Greek coins to be used to buy things (5) __________________. The ancient Romans soon caught on to the practice of using coins made of precious metals. They were the first to use symbols, pictures of buildings, and heads of emperors on their coins. In ancient India, people made a ‘money tree’ with many branches and the coins were hung from in. They also stamped pictures of dragons and imaginary animals on their coins. PAPER MONEY The Chinese people found metal coins (6) __________________ to carry around with them and decided paper was much easier to carry. At first, merchants would leave heavy strings of metal coins with a trustworthy person or agent. The agent would give the merchant a slip of paper that recorded how much money the merchant was leaving on “deposit”. These agents were (7) _______________. With silk and spice trade developing along the Silk Road, merchants didn’t have to carry all their wealth with them on camels and other pack animals. However, these promissory notes were not actual paper money, but it was the start. THE SONG DYNASTY Almost 2000 years after the Chinese invention of coins, the Song Dynasty in China began (8) __________________. The Chinese already knew how to make paper and silk. Printing on silk and on pottery was done by hand. Now they wanted to paint on paper but make it faster and make every print exactly the same. The paper was painted using woodblocks and six colors of ink.

GT4 | Unit 10 | Student booklet

In 1265, the Song Dynasty united all the provinces and printed one standard paper money that could be purchased from the government with gold or silver. Nine years later, the Song were defeated by the Mongols. THE MONGOLS Kublai Khan was the leader of the Mongols from 1215 to 1294. They made their own form of paper money and brought it to Persia (now Iran). They also showed it to Italy’s adventurer, Marco Polo, who stayed with the Khan’s court for 17 years. When he returned to Italy, he brought (9) _______________ and introduced paper money to the Roman Emperor. This way of trading currency spread to all points of the Roman Empire, from Greece, Syria, and Turkey to North Africa to France and to Spain. MODERN PAPER MONEY By the 1600s, governments all over the world had borrowed the idea of issuing paper money to its citizens. The paper money could be purchased with anything that the government considered valuable, such as gold, silver, other precious metals, gems, spices, or silk. The technique of printing money developed over the centuries. Today it involves trained craftspeople and artists to design the look of each currency, technicians to develop the different inks. Special mixtures, used to make the paper, are (10) __________________. SOURCE: https://www.coolkidfacts.com/history-of-money/

READING COMPREHENSION Read the text again and discuss these questions with a partner. 1. What is bartering? 2. What did early people use as barter? 5

3. Why was salt used in trade? 4. When and where did the idea of metal coins start? 5. Why were coins better to use than food? 6. Who were the first people to use paper money? 7.

How did paper money reach Italy and other countries?

8. When did governments start to issue money to their citizens? 2.2. Listen to the history of money.

Discuss the following with your partner. You’re going to listen to someone talking about the history of money. Before you listen, read through the statements below. Do you think they are true (coin) or false (bill)?

1. The earliest kind of money was used about 3,000 years ago. 2. Shells were used as a kind of fiat money. 3. The first metal coins appeared in Greece. 4. The first coins were round. 5. Paper money first appeared in China. 6. The idea of paper money travelled quickly to Europe.

GT4 | Unit 10 | Student booklet

Now listen and check your answers.

SOURCE: https://www.onestopenglish.com/clil-lesson-plans/money-and-banks/550876.article

INTERMEDIATE PRODUCT Students will either:

1. Create a poster with the currencies of diﬀerent countries 2. Give a two-minute presentation on the history of money, talking about: - bartering

- coins

- paper money

Note: they should use illustrations, or video excerpts to enrich their presentations.

MONEY AND BANKS 1. SUMMARY In this task, students will learn the different types of trading such as bartering, ‘commodity money’, and ‘fiat money’. They will examine their differences, advantages and disadvantages of each method. They will also learn about the world of banking, what it means, why they are used and how banks make money.

2. KEY CONTENTS 2.1. What is money? Can anything be used as money?

Choose the correct word or phrase.

1. Every purchase in a store is an exchange. A product is traded / represented for money.

GT4 | Unit 10 | Student booklet

2. Barter means the direct exchange / guarantee of one good for another. 3. In substitution for bartering, people started to use commodity money / ﬁat money, such as gold and silver. 4. Gold, silver and copper are a commodity / currency that everyone accepts as valuable. 5. Gold, silver, and copper were all valued for their uses, and they were highly regarded because of their scarcity / abundance. 6. Gold, silver and copper have intrinsic / extrinsic value. 7. Silver and gold have no use value / use value. They can be used to make things. Silver is used as a backing for mirrors and in making photographic films. Gold is used primarily in jewelry. 8. Paper money, like banknotes and coins, has no value in itself. It has only the value that a government says it has. It’s called commodity money / ﬁat money. 9. Coins and notes are used to swap / represent value. 10. Nearly every country in the world uses paper money. Governments print currency / commodity and declare it to be money.

MONEY Every purchase in a store is an exchange. A product is traded for money. In preindustrial societies, goods and services were exchanged directly, without money, in a process called barter. Mr. A exchanged his product, shoes, for a shirt made by Ms. B. Or both exchanged their products, shoes and shirts, for ten pounds of wheat grown by Mr. and Mrs. C. This process of exchange was very simple. It resembled the way some people trade baseball cards or comic books today. 9

Unfortunately, barter can quickly become complicated. If Mr. A and Ms. B both want wheat, but Mr. and Mrs. C do not want shoes or shirts, how can an exchange be made? One solution is to find a fourth party, Mrs. X, who wants shoes and shirts. She, in turn, may raise chickens—something Mr. and Mrs. C do want. She exchanges her chickens for shoes and shirts with Mr. A and Ms. B. They then take the newly acquired chickens to Mr. and Mrs. C to exchange them for wheat. This double set of exchanges is somewhat inconvenient, but it is workable. In a modern society with millions of people and hundreds of thousands of products and services, the barter system becomes impossible. The complications would be endless and overwhelming. To get rid of barter and to simplify exchange, money was invented. THE EXCHANGE PROCESS Barter is a means of direct exchange of one good for another. The use of money creates an indirect exchange. A family spends money to buy a car. This common transaction is easy to understand. What is not ordinarily noticed is that the person who sells the car for money is at the same time using the car to buy money, which is no more than a substitute for all possible products and services. Money was invented more than 4,000 years ago. People who wanted to trade goods and services gradually realized that exchange would be easier if there were some single commodity that everyone would accept as valuable. There was something — precious metal, or three precious metals, to be exact. Gold, silver, and copper were all valued for their uses, and they were highly regarded because of their scarcity. Since gold was the scarcest, it was usually — but not always — more highly valued than the other two. Just like today’s money, gold and silver have advantages over other kinds of goods. First, they have universal purchasing power — everyone agrees they are valuable. Second, they can be processed into different sizes and weights to stand for a variety of different values. Third, they are fairly durable; they will not rust or decay; they can be stored for long periods of time. Fourth, since even small amounts of these metals are valuable, it is easy to carry them around, just as it is easy to carry coins in a pocket or purse today. Fifth, silver and gold—but especially gold — have never lost their exchange value. Even after 4,000 years, gold is still acceptable in any civilized society as money. Its universal acceptability made it the medium of exchange in long-distance trade. FROM GOLD TO PAPER MONEY Silver and gold have what is called use value. Silver is used as a backing for mirrors and in making photographic film. Gold is used primarily in jewelry. When silver and gold are used as money, they have exchange value, as well as use value. Silver and gold are called “hard money.” This term does not only refer to their solidity as metals. 10

GT4 | Unit 10 | Student booklet

It suggests that silver and gold are real money, in contrast to paper money. They have inherent value. Gold and silver were assigned exchange value by people because of their scarcity and because they were potentially useful in other ways. Another term for hard money is specie, a Latin word that refers to the commodity nature of gold and silver. In other words, gold, silver, bronze, copper and other metals are examples of commodity money money. Paper money is not hard money. It has no value in itself. It has only the value that a government says it has. It is not commodity money. There is no limit to the amount of paper that can be manufactured, as long as trees grow. Paper is not scarce, though it has many uses. Paper money is called fiat money money. The word “fiat” is a Latin verb form that means “let it be.” Nearly every country in the world uses paper money. Governments print currency and declare it to be money. Its use is mandated as both legal and necessary as the proper medium of exchange within a nation. The use of gold and silver in exchange has generally been abandoned in favor of paper bills and coins made of cheaper metals. Gold and silver are now treated as commodities, on a level with soybeans and wheat. SOURCE: https://kids.britannica.com/students/article/money/275898 (Adapted)

2.2. Discuss the advantages and disadvantages of different kinds of money.

Complete the table with information from the text. EXAMPLES Bartering Commodity money

ADVANTAGES

DISADVANTAGES

swapping shoes and shirts for wheat gold, silver and copper

Fiat money notes/bills and coins

2.3. World of banking, what it means, why they are used and how banks make money.

Discuss the following with your partner. What do banks do? Make a list of all the bank services. Compare your list with other groups.

Complete each sentence with a word or phrase from the box. interest

ATM

cash

loan

checking account

purchase

deposit

fee

pay off

interest rate

withdraw

owe

1. ____________________ is extra money that you receive if you have invested a sum of money in a bank. 2. Some people prefer to pay in _______________ instead of using a debit or a credit card. 3. If you _____________ someone, you give them the amount of money that you owe them. 4. An ______________ is a machine that gives customers money when the bank is closed. 5. When you _____________ money from a bank account, you take it out of your account. 6. When you _____________ a sum of money, you put it into a checking or savings account. 7. A __________________ is a personal bank account which you can take money out of at any time using your check book or debit card. 8. When you _________________ something, you buy it. 9. If you _________________ money to someone, they have lent it to you and you have not yet paid it back. 10. A __________________ is a sum of money that you borrow. 12

GT4 | Unit 10 | Student booklet

11. A __________________ is a sum of money that you pay to the bank every month to have a checking account. 12. The ___________________ is the amount of interest that must be paid. It is expressed as a percentage of the amount that is borrowed or gained as profit.

BANKS A bank is a business like any other business except that it deals in money. A bank holds money for individuals, businesses, and governments. Like all businesses, it has to make money too, and it does this by charging interest on any money that is loaned out. Banks are very important to a country’s economy because they help money be exchanged for services and help businesses start up and survive. Banks use the money that individuals and companies deposit to give loans for the purchase of homes, cars, furniture, farms, and businesses. The person who makes a deposit into a savings account receives interest on that money. However, banks charge a higher interest rate from borrowers of this money. In other words, the rate they pay savers is less than the rate they charge borrowers. This difference between what they pay savers and what they charge borrowers is how banks earn most of their money.

TYPES OF ACCOUNTS CHECKING ACCOUNTS People use checking accounts so that they don’t have to go to the bank to get their money. It makes it easy for them to make purchases. The bank charges a fee to have a checking account – one more way the bank makes money. Today, most people use a debit card instead of a check to buy something. If people want to withdraw money from their checking accounts, the banks provide ATM machines so that people can get cash any time of the day or night and use it instead of a debit card. SAVINGS ACCOUNT This used to be a good way to save money because the bank would pay you interest for the privilege of using your money. Today, the interest the bank pays on savings accounts is almost zero, unless you have an extraordinary amount in the account, and you promise not to use it or need it for a certain length of time. 13

CREDIT ACCOUNTS The bank will allow you to make purchases on your credit card all month and charge a very high interest rate. The banks are counting on people not being able to pay oﬀ the account within the month so that they can charge more interest. They are hoping you can never pay what you owe and will keep buying and buying. It is so much easier than finding the cash to make your purchases and most people buy more than they need and buy things they really don’t need at all. SOURCE: https://www.coolkidfacts.com/how-banks-work/#more-12087 (Adapted)

Now read the text again and discuss these questions in your group. 1. How do banks earn money? 2. Why do banks give loans? Give some examples. 3. Why do people save money in a savings account? Is it still a good way to save money? 4. What is a checking account? Is it free to have a checking account?

5. If you have a checking account and want to withdraw some money, where can you go? What do those 3 letters mean? 6. What is the danger of a credit account? In other words, what should you avoid when using a credit card?

GT4 | Unit 10 | Student booklet

The convenience of credit cards comes at a price. Credits cards are one of the ways banks have to maximize their proﬁts. First, discuss these questions with your partner. - Have you ever had a credit card? - What are the dangers of using a credit card to pay with instead of money? - How do banks make money from credit cards?

10 VIDEO – Credit Cards

Look at these notes about the video sequence you are going to watch and see if you can guess the word or expression that completes the sentences. 1. Using a credit card is similar to taking out a loan / debit. 2. People who use credit cards will receive a statement / receipt each month telling them the total amount due. 3. According to the video, one possibility is to pay the full amount due on or before the ﬁnal date / due date. 4. If you pay the total amount on or before the due date, you will avoid paying interest / taxes. 5. It’s always the best to pay oﬀ / pay out your credit card debt to avoid interest. 6. Making more the minimum payment is important because it saves you money in the short run / long run. 7. The first idea of a credit card dates back to 1949 / 1959. 8. The first credit card created was the Diners Club / Visa.

9. Later, another card was created, called BankAmeriCard / America Card, which did not require people to pay it off by the end of the month. 10. There two kinds of credit card companies. On one hand, there is the bank: the issuer / the provider. 11. One way credit card companies make money is by charging the retailer / the customer a transaction fee. 12. One reason the stores accept paying the transaction fee for credit card companies is because of customer complaint / customer convenience. 13. One way credit card companies make money is by charging interest. Another way is by charging fees / taxes. 14. The companies make more money with a specific kind of customer: the debtors / the revolvers.

Now watch the videos and check your answers. Video 1: How does a credit card work?

http://bitly.ws/jugE Video 2: How credit card companies make money

http://bitly.ws/jugG

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11 Discuss these questions with your group. - What are the dangers of using a credit card to pay with instead of money? - How do credit card companies make money? - Why are the revolvers the best clients for credit card companies?

INTERMEDIATE PRODUCT Write a promotional leaﬂet for a new credit card - The aim of the leaflet is to attract potential customers for this new credit card by offering many advantages (perks) so that they can become clients. - Use an advertisement style (language, and layout). - Use images in your leaflet (not only words). Look at the following tips to help you.

Promotional leaﬂet Create a catchy headline to call your prospects’ attention. Make a list of the different perks the credit card offers such as reduced annual fees, rewards rate, cash back, discounts in different services (Netﬂix, insurance, etc.). Include other services that can become handy for your prospects such hotel bonuses, travel insurance, VIP lounges at airports, automobile services, etc. Say how the potential customers can contact the credit card company (e-mail, web page, phone number, local branches, etc.). Do some research on credit card advertisement campaigns to get some inspiration.

Write 150-200 words.

GT4 | Unit 10 | Student booklet

1. SUMMARY In this task, students will have an understanding of the types of world economic activities and talk about jobs.

2. KEY CONTENTS 2.1. The difference between primary, secondary, tertiary and quaternary activities; jobs in the four economic activities; favorite jobs in each economic area: reasons.

WHAT ARE THE 4 TYPES OF ECONOMIC ACTIVITY? To talk about the four types of economic activity, it is necessary to define what economic activity is first. Economic activity is most easily defined as the activity of producing, providing, purchasing, or selling various goods or services. It is often mentioned in the context of economic geography, and it deals with the production, consumption, and exchange of goods and services based on different spatial variations of the surface of our planet. Economic activities are present in almost every aspect of our society. The easiest way to explain this is that all activities that involve money or the exchange of products are considered economic activities. Of course, this means that there are also noneconomic activities. These activities do not include any exchange and can be anything, from helping a friend to study to going to a church to pray. Economic activities are mostly divided into four large types. These types are the primary, secondary, tertiary, and quaternary activities.

PRIMARY ACTIVITIES When talking about primary activities, we are referring to the activities that deal with the acquiring of natural resources directly from nature. Things like gathering, farming, hunting, fishing, forestry, and many other similar activities are considered primary economic activities. They involve trading of goods in various ways, so it makes them a vital part of the economy. They are activities that are mostly outdoor in nature. This is why the people that are engaged in these activities are often called red-collar workers. SECONDARY ACTIVITIES Secondary activities are a little more complex. When we classify an economic activity as a secondary activity, it means that it includes the process of adding value to products by modifying them. These activities take existing products and change them in multiple ways, which adds extra value to them. The simplest way to explain these activities is to say that they include mostly manufacturing industries. So anything that gets created in factories, from processed foods to clothes, belongs to the secondary economic activities. The name we use to describe the workers in the fields of secondary economic activities is blue-collar workers. TERTIARY ACTIVITIES The activities in this group deal with providing various kinds of service. Anything ranging from clerks and barbers to auto mechanics falls into this group. They can be most easily defined as personal and business services. A lot of these services do not offer a product that is physical in nature, but a service which we could not accomplish by ourselves. People working in tertiary activities are usually experts in specific fields that fall outside what is considered common knowledge. We call the workers in these activities pink-collar workers.

GT4 | Unit 10 | Student booklet

QUATERNARY ACTIVITIES This group of activities includes all of those that are provided in special environments. A good example would be health services, which we can only get in hospitals. Some other examples include hotels which provide us with hospitality services or schools which provide us with teaching services. These activities are the hardest to describe because they cover such a wide variety of things. For example, theaters fall under quaternary activities because they provide entertainment services. We call the workers that are engaged in quaternary activities white-collar workers. Many professions today fall under this category, like software personnel, legal consultants, financial advisors, and many more. These activities can be considered a developed form of services that requires highly specific knowledge and skills, with a high level of competence in communication. Source: https://www.worldatlas.com/articles/what-are-the-4-types-of-economic-activity.html [Adapted]

12 In groups, discuss the following questions: - What are examples of primary activities? - Do most people working in primary activities work indoors or outdoors? - Give some examples of manufactured goods. - Which type of economic activity does a mechanic work in? - Find more examples of jobs in quaternary activities.

Work in pairs. Look at the cards. Name each job and sort the cards into four categories: primary, secondary, tertiary, quaternary quaternary.

Join with another pair and check your answers.

Work in groups. Now each student in your group must choose one (or more jobs). Some jobs you would be interested in.

Tell your group why you are interested in this job. You should describe the job: indoors/outdoors; annual salary; necessary qualifications; anything else related to the job.

INTERMEDIATE PRODUCT Write an ad for a job position in your company. You are an employer and are looking for a person to work in your company. You are going to publish this ad in a job platform. Your ad should include: - A job description - The requirements for this position: education, expertise, etc. - The desired skills you are looking for. - The benefits you are offering. - A description of what the person is going to do. The person’s main responsibilities. Share your ad with the group. Look at an example:

GT4 | Unit 10 | Student booklet

1. SUMMARY This task focuses on the relationship between employers and workers, and how the laws of supply and demand operate in the labor market. Students will reflect on why people “enter” the labor market, and will be invited to reflect that these laws cannot always be applied in the real ‘labor market’. Students will also learn about wages and how they are affected by the law of supply and demand, and will reflect on the idea of ‘labor productivity’: can it be applied to all jobs? Also, they will discuss why some jobs are paid more than others. 23

2. KEY CONTENTS 2.1. Supply and demand in the labor market; Worker’s marginal product of labor (MPL); Why people enter the labor market; Labor productivity; Why some jobs pay more than others.

14 Discuss these questions. - In what situation(s) do you think a worker can ask for a lot of money? - In what situation(s) can an employer pay less money to workers?

15 Match the words with the deﬁnitions.

1. supply

A. [ ] choosing

2. demand

B. [ ] to employ someone or pay someone to do a particular job

3. wage

4. picking

D. [ ] a need for something to be sold or supplied

5. income

[ ] the money that a company receives

6. hire

[ ] to provide something that is wanted or needed

7. revenue

G. [ ] an organization that represents the people who work in a particular industry

8. union

H. [ ] amount of money that is paid to an employee

GT4 | Unit 10 | Student booklet

[ ] money that is earned from doing work

LABOR MARKET Economists talk about the world of work as the ‘labor market’, or the supply of and demand for work by people in the economy. As soon as we start working, we ‘enter the labor market’, either as an individual offering skills or as an employer seeking them. The relative number of job seekers vs available work — the supply of labor and the demand for labor — determines how much people get paid for their work, or their wages. So why do we ‘enter the labor market’ in the first place? A big assumption in a lot of simple labor market models is that individuals are motivated to work by money. In theory, we’d love to sit around all day and have fun, but because we need to buy things to live, we spend some time working to earn the money we need. By this logic, the way we decide how much we want to work is by weighing up how valuable our time off is compared to how much money we would make working. Because the labor market is controlled by supply and demand, everyone should always be able to work as many hours as they want. If you want more money, you can always work more for a lower wage. In this sense, by picking how much they work, workers get to determine their income within the limits of the kind of jobs they are able to do and the number of hours they can physically work. Some parts of this story clearly do not match up to the real world. A lot of people want to work but can’t. And a lot of people go to work for reasons other than money. So while these simplified models help make economists’ jobs easier, they are not always the most useful way to think about the real ‘labor market’ we live in. WAGES Who decides how much you earn? According to most economics textbooks, our wages are determined just like any other price: by supply and demand. People supply their labor, and companies demand it, creating a market for labor.

In broad terms, the standard theory is pretty straightforward. When a lot of people can do the same job, the wage for that job is pushed down (because more people can supply their labor). When it takes special skills or education to do a job, wages are pushed up, because fewer people can supply their labor. On the demand side, employers are willing to pay more for an employee that can make them more money. Economic theory actually gets really specific about exactly how much each person is paid. According to the theory, when companies want to hire a new worker, they will look at how much money they think the worker will bring into the company. Economists call this number the worker’s marginal product of labor (MPL). It wouldn’t make sense for a company to pay someone more than the amount of money they’ll bring in, or the company would lose money on the employee. It’s also no good if they try to pay the employee less than what they’ll bring in, because some other company could pay a higher wage to steal the employee away and still make money on the deal. So wages are set exactly at the amount of revenue the new employee will create: their marginal product of labor. This theory describes a ‘perfect’ market, where all the employers are trying to maximize profit, there’s lots of competition and everyone is able to work as much as they want. Pretty much everyone recognizes that’s not always the case. But some economists think the theory is close enough to the real world to be useful, and others think it’s just way off. They think it ignores important parts of how the real world works — things like unemployment, power inequalities and unions. First off, the idea of ‘labor productivity’ doesn’t make sense for every job. You might be able to reasonably calculate how much an additional salesclerk or factory worker will make you, but for a lot of jobs it’s not so clear cut. And it’s even harder to apply the concept to non-profit sectors like public education, medicine or security where the employees aren’t bringing in revenue, but are instead making some kind of public good (like education, health or safety). Also, in the theory, wages are held up by competition between employers: if you think you are not being paid what you are worth, you can quit and get a higher wage. But in the real world that’s a pretty risky strategy; you might end up stuck with no job instead. Persistent unemployment changes workers options in a way that can give employers more power in determining pay. Workers can also become more powerful when they are able to organize into unions. A single worker might not have much to say about their wages, but millions of workers acting together can force employers to set wages higher, or provide other benefits like better working conditions. Similarly, governments can create regulations like minimum wages that bring wages up as well. Supply and demand also doesn’t say much about the value of a job. A lot of the most socially beneficial jobs aren’t the best paid: talk to any public school teacher or nurse about this one. Supply and demand are still pretty powerful ideas for explaining why some jobs are paid more than others. However, it is just good to remember that it’s not always the whole story: power often plays a big role too. 26

GT4 | Unit 10 | Student booklet

CASE STUDY 1 Why is LeBron (basketball player) paid more than a nurse? SUPPLY Salesclerks get paid less than nurses, because it takes a lot longer to train someone to be a nurse than a clerk (more people can supply their labor as a clerk). And LeBron James gets paid more than a nurse, because the supply of basketball super-humans is incredibly small: no matter how hard you work, you’ll probably never be quite as good at basketball as King James. CASE STUDY 2 Why are some accountants paid more than others? PRODUCTIVITY An accountant working for a big French company will probably make more than an accountant working for a Ukrainian company. They have similar training and are doing similar work. But if each is paid according to the monetary value they bring the company, the French accountant will make more because her company is more profitable. Her ‘marginal product of labor’ is determined not just by the work she does, but also by the company she works for. The same set of skills are more ‘valuable’ in one country than another, because skills only have value within the context of what is happening in the wider economy. Source: https://www.ecnmy.org/learn/your-livelihood/wages/who-decides-how-much-we-earn/ [Adapted]

16 Based on the text, complete the sentences below in your own words. 1. The supply and demand in the labor market means

2. When a lot of people can do the same job

3. The price of labor rises because

4. When companies want to hire a new worker,

5. The concept of Marginal Product of Labor (MPL) means

. 27

17 Discuss this question. What would influence whether you want to work or not? Think about: - wages - free time (time off) - where the job is situated - nature of work

18 DISCUSSION (CASE STUDIES 1 AND 2)

Discuss these questions.

- Why are some jobs paid better than others? - Why do some people get paid more than others for doing the same job? Read case studies 1 and 2 again. The first one is related to supply, supply while the second is related to productivity. Can you think of two other examples for each case? Explain the situation with a small presentation to the class.

19 Discuss these questions. - Do people only work for money? - What other motivation is there to work?

GT4 | Unit 10 | Student booklet

INTERMEDIATE PRODUCT – TV INTERVIEW Prepare a TV interview with an expert on the topic of the Labor Market. One person will be the interviewer and the other will be the expert (economist). You could pretend you are part of a talk show on TV and the rest of the class can be the audience. Think of the following questions to guide your interview: - How is the labor market just like any other market? - What affects demand for labor? - What affects the supply of labor? - What motivates people to work? - Any other relevant question.

Material de apoio - SPEAKING ACTIVITY 13 (p. 22)

1. SETOR PRIMÁRIO:

FARMER

CATTLE BREEDER

MINER

FISHERMAN

2. SETOR SECUNDÁRIO:

GARMENT INDUSTRY WORKER

AUTOMOBILE INDUSTRY WORKER

STEEL INDUSTRY WORKER

ELECTRONICS INDUSTRY WORKER

3. SETOR TERCIÁRIO:

DENTIST

MECHANIC

BARBER

LAWYER

4. SETOR QUATERNÁRIO:

NURSE

DOCTOR

TEACHER

ACTOR