A way of explaining unemployment through a wage-setting game

We investigate a duopsonistic wage-setting game in which the firms have a limited number of workplaces. We assume that the firms have heterogeneous productivity, that there are two types of workers with different reservation wages and that a worker's productivity is independent of his type. We show that equilibrium unemployment arises in the wage-setting game under certain conditions, although the efficient allocation of workers would result in full employment.

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Year of publication:	2003
Authors:	Tasnádi, Attila
Publisher:	Bonn : University of Bonn, Bonn Graduate School of Economics (BGSE)
Subject:	Arbeitslosigkeit \| Lohn \| Duopol \| Spieltheorie \| Theorie \| Unemployment \| Bertrand-Edgeworth \| wage-setting games

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Series:	Bonn Econ Discussion Papers ; 14/2003
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	382890337 [GVK] hdl:10419/22881 [Handle] RePEc:zbw:bonedp:142003 [RePEc]
Classification:	J41 - Contracts: Specific Human Capital, Matching Models, Efficiency Wage Models, and Internal Labor Markets ; E24 - Employment; Unemployment; Wages
Source:	EconStor

Persistent link: https://www.econbiz.de/10010263101