Goods-market competition and profit sharing: a multisector macro approach
AbstractThis paper develops a theoretical model that relates the degree of goods-market competition with the extent of profit sharing. The authors multisector framework indicates that increased competition in goods markets leads to an increased weighting on firm profits in an optimally indexed contract. Consequently, our model predicts that a rising extent of profit-sharing arrangements in actual U.S. contracts should accompany an increase in the degree of goods-market competition. Available, but limited, data on profit sharing in the United States is generally consistent with this fundamental implication of the model.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economics and Business.
Volume (Year): 50 (1998)
Issue (Month): 6 (November)
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Web page: http://www.elsevier.com/locate/jeconbus
Other versions of this item:
- John V. Duca & David D. VanHoose, 1997. "Goods-market competition and profit sharing: a multisector macro approach," Working Papers 9709, Federal Reserve Bank of Dallas.
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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