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Can the supply curve shift left while the PPF remains unchanged? For example, if I am a blue berry farmer and I injure my leg, I can no longer pick as many blue berries. So in the blue berry market, the supply curve for any price would shift to the left.

The number of blue berries I have available to pick hasn't changed, therefore the PPF NOT shift but instead I wouldn't be producing along the PPF but inside the PPF. So, the supply curve has shifted left, and my position on the PPF is on the inside of the curve, but the PPF itself hasn't shifted. Is that correct?

If so, my follow up question of the same topic is: is it true that the PPF does NOT concern itself with the method of using resources, just the resources themselves? E.g. if a factory burns down but the stock of resources that goes through the factory remains unaffected, the supply curve would shift and the PPF would remain unchanged. Correct?

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The supply curve can shift left while the PPF remains unchanged, but your example isn't an instance of that. The key to getting a good example is to recognize that the supply curve depends on prices of inputs while the PPF does not.

Suppose I hire someone to water my blueberry trees and for some reason the wages of that person increase. Now since my costs increase I must charge a higher price for any quantity. That means my supply curve shifts to the left. However, the PPF is unchanged. I can still produce the exact same number of blueberries as before.

In your example due to the injury (or factory burning down) I cannot produce the same number of blueberries as before so the PPF shifts as well.

EDIT: This answer is a partial equilibrium response. In a general equilibrium analysis you would consider why wages shifted. If that was because of changes in the scarcity of resources (there are fewer blueberry tree waters that I can hire) then the PPF would shift as well.

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  • $\begingroup$ In most models where the PPF is used the PPF and the prices of the goods produced determine the prices of the inputs. See Heckscher-Ohlin or Rybczynski. In this setting one cannot treat the PPF and input prices independently. $\endgroup$ – Giskard Feb 25 '18 at 17:59
  • $\begingroup$ I agree. I edited the response. $\endgroup$ – dsmithecon Feb 25 '18 at 18:24
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Edited.

PPF is the maximum potential output that a country could produce using its resources and technology. No, the PPF should shrink due to the loss of labour (from leg injury).

No, factory is a stock of capital, thus, ppf should shrink due to loss of capacity. It is also affected by the technology of production i.e. methods of production. It moves outwards due to technological progress.

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  • $\begingroup$ Agh, yes, did not take into account the leg injury, Edited. $\endgroup$ – london Feb 25 '18 at 10:29

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