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Marginal Revenue Product of Labour - Explained (Labour Markets)

A Level, IB
AQA, Edexcel, OCR, IB, Eduqas, WJEC

Marginal revenue product of labour (MRPL) is the extra revenue generated when an additional worker is employed.

Marginal Revenue Product of Labour

The formula for MRPL = marginal product of labour x marginal revenue.

The demand curve for labour tells us how many workers a business will employ at a given wage rate in a given time period

In the theory of competitive labour markets, the demand curve for labour comes from the estimated marginal revenue product of labour (MRPL)

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