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Efficiency Wages and Underemployment in the Long Run

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  • Dutta, J.

Abstract

This paper eonsiders the possibility of long run underermployment with capital accumulation. Wages affect labour productivity; possibly, but not necessarily, through worker's nutrition. Finns' set wages, and underemployment results, provided the aggregate capital stock is low. As capital accumulates, the economy achieves full employment. We consider the cunditions on population growth, as well as industrial structure, which allow an economy to escape from persistent. underemployment.
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Suggested Citation

  • Dutta, J., 1992. "Efficiency Wages and Underemployment in the Long Run," Papers 176, Cambridge - Risk, Information & Quantity Signals.
    • Handle: RePEc:fth:cambri:176
    as

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