The efficiency of surplus sharing

Nicolas Petrosky-Nadeau and Etienne Wasmer

No 1318, 2016 Meeting Papers from Society for Economic Dynamics

Abstract: What is the optimal sharing of value added between entrepreneurs, labor and creditors, and the optimal sharing between consumers and producers? We study the constrained efficiency properties of a model with search frictional credit, labor and goods markets. The social planner's allocation seeks to minimizes turnover costs in all three markets. The decentralized allocation with Nash bargaining is constrained efficient if Hosios conditions hold in each of the credit, labor and goods markets. Deviations from Hosios in the labor market can lead to either over or under hiring. Deviations from Hosios in the credit market always leads to under hiring. The effects of deviations from Hosios in the good market depend on the direction of the deviation from Hosios in the labor market.

Date: 2016
New Economics Papers: this item is included in nep-dge
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://red-files-public.s3.amazonaws.com/meetpapers/2016/paper_1318.pdf (application/pdf)

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:red:sed016:1318

Access Statistics for this paper

More papers in 2016 Meeting Papers from Society for Economic Dynamics Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().