However, in labour markets, we can often witness a backward bending supply curve. As a result, increased salaries may eventually cause a decrease in the labor force.
A backward-bending supply curve of labor, also known as a backward-bending labour supply curve, is a graphical tool used in economics to depict a situation where, as real (inflation-corrected) wages rise above a certain point, people begin to substitute leisure (non-paid) time for time previously devoted to paid work. As a result, higher wages result in a decrease in the labour supply and less labor being available for sale. The "labour-leisure tradeoff" is the choice wage-earning people must make between the amount of time spent doing unpleasant but financially necessary work and the satisfaction-producing unpaid time that enables participation in "leisure" activities and the use of time for essential self-maintenance tasks like sleeping.
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