Modelling Aggregate Labour Demand
AbstractWe derive a conditional long run labour demand equation via a representative firm level profit maximising problem, where production takes place according to a constant elasticity of substitution (CES) production function. This theoretical framework is augmented by cyclical explanatory variables to form an error correction model, which is then estimated using standard econometric methods. Estimates of important labour demand parameters, such as the elasticity of substitution between capital and labour, are consistent with previous Australian studies.
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Bibliographic InfoPaper provided by Treasury, Australian Government in its series Treasury Working Papers with number 2012-02.
Length: 13 pages
Date of creation: Feb 2012
Date of revision: Dec 2012
labour demand; technical change; production function;
Find related papers by JEL classification:
- J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-12-22 (All new papers)
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