Time Discount and Convex Hiring Cost
AbstractWhen rebargaining on wages is allowed after the worker-firm match is formed, search equilibrium with multiple hiring does not necessarily exhausts labor resources when hiring cost is convex. The level of output depends on the time discount factor of the consumer. Properties of the resulting demand-driven business cycles are studied using periodic steady state technique with comparison with the productivity cycles. Wage rate generally exhibits phase shift against marginal productivity for discount factor fluctuation in contrast to the synchronization of the productivity cycle case.
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Bibliographic InfoPaper provided by Otaru University of Commerce in its series ビジネス創造センターディスカッション・ペーパー (Discussion papers of the Center for Business Creation) with number 10252/4850.
Length: 32 pages
Date of creation: Apr 2012
Date of revision:
Publication status: Published in Discussion paper series (2012), 147: 1-32
This paper has been announced in the following NEP Reports:
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