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Involuntary Unemployment and the Existence of GDP Functions

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  • Max Albert
  • Jürgen Meckl

Abstract

We develop a simple general equilibrium model of production where, despite the existence of involuntary unemployment, non–equalized job rents are the only distortion. Hence, a standard GDP function exists. Unemployment results from either efficiency wage setting or wage bargaining.

Suggested Citation

  • Max Albert & Jürgen Meckl, 2003. "Involuntary Unemployment and the Existence of GDP Functions," Metroeconomica, Wiley Blackwell, vol. 54(1), pages 79-88, February.
    • Handle: RePEc:bla:metroe:v:54:y:2003:i:1:p:79-88
    DOI: 10.1111/1467-999X.00160
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    References listed on IDEAS

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    6. James Harrigan & Rita Balaban, 1999. "U.S. Wages in General Equilibrium: The Effects of Prices, Technology, and Factor Supplies, 1963-1991," NBER Working Papers 6981, National Bureau of Economic Research, Inc.
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    8. George A. Akerlof, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 97(4), pages 543-569.
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    10. Albert, Max & Meckl, Jürgen, 1997. "Efficiency wages, unemployment and welfare: A trade theorists' guide," Discussion Papers, Series II 348, University of Konstanz, Collaborative Research Centre (SFB) 178 "Internationalization of the Economy".
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    Cited by:

    1. Gilbert L. Skillman, 2022. "The Nash bargaining solution in labor market analysis," Metroeconomica, Wiley Blackwell, vol. 73(3), pages 884-899, July.

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