Efficiency-wage unemployment and endogenous growth
This paper examines positive and normative implications of efficiency-wage induced unemployment within a model of endogenous growth. Sectorspecific impacts of the wage rate on labor efficiency establish a correlation between the growth rate and the rate of unemployment. The sign of this correlation is shown to be given by the intersectoral wage differential. Despite the existence of unemployment, decisive positive properties of the full-employment model are preserved. However, welfare implications of the full-employment model may be reversed. The optimal policy can be to reduce growth, while at the same time raising unemployment.
|Date of creation:||1999|
|Date of revision:|
|Contact details of provider:|| Postal: D-78457 Konstanz|
Phone: +49 7531 88 2314
Web page: http://www.wiwi.uni-konstanz.de/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- George A. Akerlof, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, Oxford University Press, vol. 97(4), pages 543-569.
- Oswald, Andrew J, 1997.
"Happiness and Economic Performance,"
Royal Economic Society, vol. 107(445), pages 1815-31, November.
- Oswald, A.J., 1997. "Happiness and Economic Performance," Papers 18, Centre for Economic Performance & Institute of Economics.
- Oswald, Andrew, 1997. "Happiness and Economic Performance," The Warwick Economics Research Paper Series (TWERPS) 478, University of Warwick, Department of Economics.
- Aghion, Philippe & Howitt, Peter, 1991.
"Growth and Unemployment,"
CEPR Discussion Papers
577, C.E.P.R. Discussion Papers.
- Bean, Charles & Pissarides, Christopher, 1993.
"Unemployment, consumption and growth,"
European Economic Review,
Elsevier, vol. 37(4), pages 837-854, May.
- Summers, Lawrence H, 1988.
"Relative Wages, Efficiency Wages, and Keynesian Unemployment,"
American Economic Review,
American Economic Association, vol. 78(2), pages 383-88, May.
- Lawrence H. Summers, 1988. "Relative Wages, Efficiency Wages, and Keynesian Unemployment," NBER Working Papers 2590, National Bureau of Economic Research, Inc.
- Solow, Robert M., 1979. "Another possible source of wage stickiness," Journal of Macroeconomics, Elsevier, vol. 1(1), pages 79-82.
- Krueger, Alan B & Summers, Lawrence H, 1988. "Efficiency Wages and the Inter-industry Wage Structure," Econometrica, Econometric Society, vol. 56(2), pages 259-93, March.
- Benassy, Jean-Pascal, 1998.
"Is there always too little research in endogenous growth with expanding product variety?,"
European Economic Review,
Elsevier, vol. 42(1), pages 61-69, January.
- Bénassy, Jean-Pascal, 1996. "Is there always too little research in endogenous growth with expanding product variety ?," CEPREMAP Working Papers (Couverture Orange) 9615, CEPREMAP.
- van Schaik, A.B.T.M. & de Groot, H.L.F., 1995.
"Unemployment and endogenous growth,"
1995-75, Tilburg University, Center for Economic Research.
- Paul Romer, 1989.
"Endogenous Technological Change,"
NBER Working Papers
3210, National Bureau of Economic Research, Inc.
- Winkelmann, Liliana & Winkelmann, Rainer, 1998. "Why Are the Unemployed So Unhappy? Evidence from Panel Data," Economica, London School of Economics and Political Science, vol. 65(257), pages 1-15, February.
When requesting a correction, please mention this item's handle: RePEc:zbw:kondp1:295. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.