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Wage Bargaining and Unemployment in a General Equilibrium Model

Author

Listed:
  • Hans Jørgen Jacobsen

    (Institute of Economics, University of Copenhagen)

  • Christian Schultz

    (Institute of Economics, University of Copenhagen)

Abstract

A multisectoral temporary general equilibrium macro model with wage bargaining is presented. In each sector agents are divided into capitalists and workers. The markets for produced goods and money are competitive, but the wage rate in a sector is determined by negotiation between an employers' union and a trade union both caring about their members' utilities. Nash bargaining equilibria will for certain values of parameters be characterized by unemployment, for others by full employment. A characterization result is given.

Suggested Citation

  • Hans Jørgen Jacobsen & Christian Schultz, 1989. "Wage Bargaining and Unemployment in a General Equilibrium Model," Discussion Papers 89-01, University of Copenhagen. Department of Economics.
  • Handle: RePEc:kud:kuiedp:8901
    as

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