Labour determination using fixed capital: A case study of processing companies.

Abstract

The production process is one faced by the critical question as to how much input is going to produce the desired amount of output. However the choice of quantity of the inputs is directly affected mainly by the input prices. On the other hand, the quantity of product demanded, the availability of raw materials, the marginal productivity of labour and the inventory available also affect the quantity of inputs required for the production process. This study will focus on the short run operations of the production process, where labour will be varied while using fixed amount of capital.In the economics of labour and industry, a profit maximizing firm in a competitive market will reduce the demand for labour when the cost of hiring labour increases. However, in practical this is not always the case. In some industries, the demand for labour remain the same or even increases after an increase in wagNo table of contents entries found.es either internally or as a result of state intervention. The main objective is to determine the factors causing the labour industry to defy the economic principle of economics described above. This study will target the short run operations of three processing companies in Nairobi, Ruaraka industrial area. The researcher will carry out a case study research. The researcher will be an an analysis of the records of the firms to establish the relationship between labour demand and the factors that influenced the demand for labour in the year 2015 of the firm’s operations, thus will be using secondary data for both quantitative and qualitative analysis. The researcher will use linear multiple regression for analysis for the determination of the coefficients of determination and the correlation of the demand for labour and the factors influencing it. The results of the analysis will be used to draw the conclusions and establish areas of further research in the same field.