Demonstrate and illustrate graphically why the most desirable technique for raising wages rates is to increase demand of labor from trade union point of view . explain the limitations of trade union?

To demonstrate graphically why increasing demand for labor is the most desirable technique for raising wage rates from a trade union's point of view, we can use a simple supply and demand diagram.

1. Graphical representation:
- On the x-axis, we have the quantity of labor, and on the y-axis, we have the wage rate.
- The supply curve of labor (S) slopes upward, indicating that as the wage rate increases, the quantity of labor supplied also increases.
- The demand curve for labor (D) slopes downward, indicating that as the wage rate increases, the quantity of labor demanded decreases.
- The intersection of the supply and demand curves determines the equilibrium wage rate and quantity of labor.

Now, let's illustrate the impact of increasing demand for labor on wage rates:
- If the demand for labor increases (shifts to the right), the equilibrium wage rate will increase, and the quantity of labor employed will also increase.
- This increase in demand can be achieved through various means, such as economic growth, increased investment, or government policies that promote job creation.
- From a trade union's perspective, this is desirable as it leads to higher wages for their members.

2. Limitations of trade unions:
While trade unions aim to improve the working conditions and wages of their members, they do face certain limitations:

a) Limited bargaining power: Trade unions may not always have sufficient bargaining power to negotiate higher wages or better working conditions, especially if the labor market is competitive or if the industry is facing economic downturns.

b) Unintended consequences: Demanding higher wages can lead to unintended consequences, such as reduced demand for labor, which may result in job losses or reduced hours for union members.

c) Inequality: Trade unions primarily focus on improving the conditions of their members, which can lead to wage disparities between unionized and non-unionized workers, potentially exacerbating income inequality.

d) Globalization and outsourcing: In an increasingly globalized world, trade unions may face challenges due to outsourcing and offshoring of jobs, as companies seek lower labor costs in other countries.

e) Legal and regulatory constraints: Trade unions are subject to legal and regulatory frameworks that may limit their ability to take certain actions, such as strikes or collective bargaining, which can impact their effectiveness in raising wages.

It is important to note that the impact and limitations of trade unions can vary across different countries, industries, and labor market conditions.