Pareto Inefficiency of Market Economies: Search and Efficiency Wage Models
AbstractThis paper shows that market economies with search and in which wages are affected by efficiency wage considerations are not constrained Pareto efficient. Wages are not set at Pareto efficient levels, nor is the level of employment (unemployment) Pareto efficient. We identify the nature of the biases and the welfare improving government interventions.
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Bibliographic InfoArticle provided by American Economic Association in its journal American Economic Review.
Volume (Year): 78 (1988)
Issue (Month): 2 (May)
Other versions of this item:
- Bruce Greenwald & Joseph E. Stiglitz, 1989. "Pareto Inefficiency of Market Economies: Search and Efficiency Wage Models," NBER Working Papers 2651, National Bureau of Economic Research, Inc.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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