Backward-bending of labor supply function and free riders

Yoshino Hisao

No 350, IDE Discussion Papers from Institute of Developing Economies, Japan External Trade Organization(JETRO)

Abstract: It seems like that backward- bending of labor supply function can be observed in Central Asian Countries such as Uzbekistan and Kazakhstan. People’s basic needs of life are satisfied and they do not increase labor supplies even if wage increases. It is possible to find some cases in which slowdowns increase, when a manager in a firm enforces penalties for workers have slowdowns. This phenomenon occurs because a worker prefers the position of equilibrium on the labor supply function always in the upper direction. This article explains the increase of free-riders by penalties and how to avoid them.

Keywords: Central Asia; Labor problems; Labor market; Backward- bending; Labor Supply Function; Free Riders (search for similar items in EconPapers)
JEL-codes: C70 J20 J22 (search for similar items in EconPapers)
Date: 2012-03-01
New Economics Papers: this item is included in nep-lab and nep-lma
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Published in IDE Discussion Paper = IDE Discussion Paper, No. 350. 2012-03-01

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