Unemployment and Growth in the Long Run: An Efficiency-Wage Model with Optimal Savings

Richard Brecher, Zhiqi Chen and Ehsan Choudhri ()

No 00-01, Carleton Economic Papers from Carleton University, Department of Economics

Abstract: This paper develops an efficiency-wage model of steady-state equilibrium with labor-augmenting technical progress, and uses the model to explore the long-run relationship between unemployment and growth. The rate of productivity growth is either specified exogenously or determined endogenously (from learning by doing). In both cases, we preserve key results of the Shapiro-Stiglitz efficiency-wage analysis without growth. Our model, however, also yields some striking new results. For inStance, an exogenous increase in the growth rate may raise the rate of efficiency-wage unemployment, and a once-for-a1l rise in the labor force may reduce the unemployment rate in the endogenous-growth case.

Keywords: economic growth; unemployment; efficiency wage.; economic growth; unemployment; efficiency wage (search for similar items in EconPapers)
JEL-codes: E24 O41 (search for similar items in EconPapers)
Date: 2000, Revised 2002-09
References: Add references at CitEc
Citations: View citations in EconPapers (21)

Published: Revised version in International Economic Review, Vol. 43, No. 3 (August 2002), pp. 875–894

Downloads: (external link)
http://www.carleton.ca/economics/research/working- ... apers-cep-1991-2000/
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.carleton.ca/economics/research/working-papers/carleton-economic-papers-cep-1991-2000/ [302 Found]--> https://carleton.ca/economics/research/working-papers/carleton-economic-papers-cep-1991-2000/)

Related works:
Journal Article: Unemployment and Growth in the Long Run: An Efficiency-Wage Model with Optimal Savings (2002)
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:car:carecp:00-01

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Carleton Economic Papers from Carleton University, Department of Economics C870 Loeb Building, 1125 Colonel By Drive, Ottawa Ontario, K1S 5B6 Canada.
Bibliographic data for series maintained by Court Lindsay ().