Involuntary Unemployment in Imperfectly Competitive General Equilibrium Models

Laurence Lasselle and Serge Svizzero

CRIEFF Discussion Papers from Centre for Research into Industry, Enterprise, Finance and the Firm

Abstract: This paper is about involuntary unemployment in general equilibrium models with imperfect competition. It surveys papers written after the seminal work of d'Aspremont, Dos Santos Ferreira and Gérard-Varet (1984). This unemployment is called involuntary because it exists at any wage. It results from imperfect competition in the product markets, more specifically from firms' excessive market power. These papers have focussed their attention on the required conditions for involuntary unemployment. In our presentation, we characterise this form of unemployment through three elements: consumers' preferences, price expectations and Ford effects. Each element is important because it influences the demand for the good and hence its price elasticity, the latter being central in the definition of firms' market power.

Keywords: competition; preferences; price-elasticity; unemployment (search for similar items in EconPapers)
JEL-codes: D43 E24 (search for similar items in EconPapers)
Date: 2000-02
New Economics Papers: this item is included in nep-lab
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Related works:
Journal Article: Involuntary Unemplyment in Imperfectly Competitive General Equilibrium Models (2002)
Working Paper: Involuntary Unemployment in Imperfectly Competitive General Equilibrium Models (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:san:crieff:0008

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