Asymmetric Information, Bargaining, and Unemployment Fluctuations
AbstractThe author constructs a dynamic general equilibrium model where wages are determined by bilateral bargaining and the firm has superior information. The asymmetry of information introduces unemployment fluctuations and dynamic wage sluggishness. Because the information of the firm only is revealed gradually, wages fall slowly in response to a negative shock and unemployment exhibits additional persistence. It is shown that high job destruction will generally be followed by a period of higher than average job destruction, that the presence of common shocks introduces an informational externality, and that bargaining is an inefficient method of wage determination compared to implicit contracts. Copyright 1995 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association in its journal International Economic Review.
Volume (Year): 36 (1995)
Issue (Month): 4 (November)
Contact details of provider:
Postal: 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297
Phone: (215) 898-8487
Fax: (215) 573-2057
Web page: http://www.econ.upenn.edu/ier
More information through EDIRC
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Pablo Ruiz Verdú, 2002. "Employer Behavior When Workers Can Unionize," Business Economics Working Papers wb020803, Universidad Carlos III, Departamento de Economía de la Empresa.
- Croitoru, Lucian, 2011. "Three Unemployment Rates Relevant To Monetary Policy," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 213-238, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or ().
If references are entirely missing, you can add them using this form.