The Distribution of Excess Demand for Labor and the Phillips Curve

Rolf Jens Brunstad
Additional contact information
Rolf Jens Brunstad: Institute of Industrial Economics

A chapter in Unemployment, 1981, pp 71-87 from Palgrave Macmillan

Abstract: Abstract It is rigorously demonstrated that a relation which has the main characteristics of the curve found by Phillips will exist, provided that the distribution of excess demand over submarkets is constant in a certain sense. The excess demand for labor in each submarket is divided into two components: the cyclical component common to all submarkets and the structural component specific to the sub-market in question. Relative excess demand in each submarket is the product of the cyclical and structural components minus one. Assuming for simplicity that the structural components are continuously distributed, the Phillips curve is then derived from the cumulative density function of this distribution. It is also shown that changes in the spread of this distribution will alter the position of the Phillips curve and the natural rate of unemployment. It is demonstrated that, unless checked by exogenous forces, endogenous market forces in each sub-market and mobility between submarkets will tend to move the Phillips curve inwards, whereas the Scandinavian type of trade unionism will counteract this tendency.

Keywords: Structural Component; Labor Supply; Natural Rate; Excess Demand; Wage Level (search for similar items in EconPapers)
Date: 1981
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-05966-9_6

Ordering information: This item can be ordered from
http://www.palgrave.com/9781349059669

DOI: 10.1007/978-1-349-05966-9_6

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().