Do Deferred Wages Dominate Involuntary Unemployment as a Worker Discipline Device? PDF Download
Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download Do Deferred Wages Dominate Involuntary Unemployment as a Worker Discipline Device? PDF full book. Access full book title Do Deferred Wages Dominate Involuntary Unemployment as a Worker Discipline Device? by . Download full books in PDF and EPUB format.
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
Get Book Here
Book Description
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
Get Book Here
Book Description
Author: George A. Akerlof
Publisher:
ISBN:
Category : Incentives in industry
Languages : en
Pages : 39
Get Book Here
Book Description
In the most widely analyzed type of efficiency wage model of involuntary unemployment, firms pay wages in excess of market clearing to give workers an incentive not to shirk. Such payments in excess of market clearing and the resultant equilibrium unemployment act as a worker discipline device. This paper concerns what is usually considered the most important theoretical criticism of such models: the so-called bonding argument. The essence of the bonding critique is that contracts whereby workers pay a bond to the firm upon taking a job (or pay an employment fee to gain employment) can eliminate involuntary unemployment. Explicit upfront bonds are only quite rarely observed. A more subtle form of the bonding critique argues that implicit bonding through upward sloping wage profiles and other deferred payment schemes can perfectly substitute for upfront bonds in providing incentives not to shirk and thereby allow the labor market to clear. This paper shows that upward sloping wage profiles do not act as a perfect substitute for explicit bonds in a natural extension of the shirking model in which workers are finite lived, the monitoring of worker behaviors on the job is costly, and firms have reputations for honesty as employers. In the absence of direct upfront bonding, optimal payment schedules will be in excess of market clearing. The reason why upward sloping wage profiles that are market clearing will not generally be the optimal labor contract is simple: delayed payment may provide sufficient incentive to prevent shirking late in the life of the contract, but in the beginning of the contract it does not prevent shirking. And it turns out in a variety of stylized cases, it is cheaper for the firm to pay a wage premium rather than to accept worker shirking early in the contract. The implications of potential worker malfeasance in the absence of explicit bonds for compensation schedules, job assignments, and firm monitoring strategies over the course of a worker's career are also analyzed
Author: George A. Akerlof
Publisher:
ISBN:
Category : Deferred compensation
Languages : en
Pages : 56
Get Book Here
Book Description
Author: George A. Akerlof
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Get Book Here
Book Description
Author:
Publisher:
ISBN:
Category : Labor laws and legislation
Languages : en
Pages : 638
Get Book Here
Book Description
Publishes in-depth articles on labor subjects, current labor statistics, information about current labor contracts, and book reviews.
Author: Yoram Weiss
Publisher: Springer
ISBN: 1349106887
Category : Social Science
Languages : en
Pages : 350
Get Book Here
Book Description
A collection of papers which analyzes and measures unemployment as a search activity, discusses efficiency wage models and which considers the impact of government and unions on employment and unemployment.
Author: National Bureau of Economic Research
Publisher:
ISBN:
Category : Economic history
Languages : en
Pages : 480
Get Book Here
Book Description
Author: Orley Ashenfelter
Publisher:
ISBN:
Category : Employment (Economic theory)
Languages : en
Pages : 520
Get Book Here
Book Description
Comprises a collection of papers published since 1958 which addresses the application of economic theory to the study of the labour market.
Author: Andrew Weiss
Publisher:
ISBN:
Category : Employee selection
Languages : en
Pages : 66
Get Book Here
Book Description
This paper analyzes a sorting model of labor contracts when workers have private information about their own productivities, and firms can test (monitor) workers. We show that sorting considerations alone generate steep wage-tenure profiles, high turnover rates of newly hired workers, and mandatory retirement rules. We find that if test results are only informative to the testing firm, and hiring is costless, then all workers that fail the test are fired. When hiring is costly, we derive conditions under which the firm retains sane (or all) workers that fail its test. We also derive conditions under which the firm tests sane, but not all, of its workers. In the second part of this paper, we consider the case when there are no hiring costs and there are many identical firms competing for the good type workers. we characterize the optimal contracts am show that competition for workers can lower total output. This is because competition can induce firms to increase the proportion of their workers that they test, rot it the test is costly, this lowers output. Finally, we show that because a mandated minimum wage affects the probability of a firm testing its worker's, an increase in the minimum wage can increase (or decrease) aggregate output.
Author:
Publisher:
ISBN:
Category : Business
Languages : en
Pages : 326
Get Book Here
Book Description
