Employment Response To Supply-and-demand Shocks Under Envy in Wage Formation
(1994) De Economist — Vol. 142, n° 2, p. 193-209 (1994)
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- Abstract
- We analyse the impact of wage envy on employment and on its sectorial allocation. A multi-sector general equilibrium model in which externalities among sectors arise through wage envy and decentralized bargaining is presented. In the no externality case, sectorial employment is a function of sectorial productivity and of the disutility of work. In the externality case, sectorial employment is additionally affected by union power in all sectors (with a negative sign even though bargaining is efficient), by the productivity in the other sectors (with an undetermined sign) and by the relative average propensity to consume goods of this sector (with a positive sign).
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Citations
De la Croix, D. (1994). Employment Response To Supply-and-demand Shocks Under Envy in Wage Formation. De Economist, 142(2), 193-209. https://doi.org/10.1007/BF01388165 (Original work published 1994)