Involuntary Unemployment and Intrafirm Bargaining with Replacement Workers

It is universally agreed that involuntary unemployment is an evil for unemployed individuals, who lose both income and the non-pecuniary benefits of paid employment, and for society, which loses the productive labor that the unemployed are unable to expend. It is nearly as widely agreed that there is at least a prima-facie case for alleviating this evil – for reasons of justice and/or benevolence and/or social order. Finally, there is little doubt that the evils of involuntary unemployment cannot be adequately addressed in contemporary societies without state intervention – whether through monetary or fiscal policies, cash payments or other subsidies to the unemployed, direct provision of employment by the state, or some combination of these measures.

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THE SUBJECTIVAL CONTENT OF IMAGES “SUCCESSFUL MAN” AND “SUCCESSFUL WOMAN” AS A FACTOR OF PSYCHIC ADJUSTMENT OF WOMEN IN INVOLUNTARY UNEMPLOYMENT SITUATION

Sovremennye issledovaniya sotsialnykh problem ◽

10.12731/2218-7405-2013-6-41 ◽

2013 ◽

Keyword(s):

Involuntary Unemployment

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Involuntary Unemployment in a Neoclassical Model

Studia Universitatis Babe-Bolyai Oeconomica ◽

10.2478/subboec-2020-0007 ◽

2020 ◽

Vol 65 (2) ◽

pp. 12-28

Author(s):

Yasuhito Tanaka

Keyword(s):

Wage Rate ◽

Utility Maximization ◽

Overlapping Generations ◽

Monopolistic Competition ◽

Returns To Scale ◽

Profit Maximization ◽

Nominal Wage ◽

Olg Model ◽

Neoclassical Model ◽

Involuntary Unemployment

AbstractWe show the existence of involuntary unemployment without assuming wage rigidity using a neoclassical model of consumption and production. We consider a case of indivisible labor supply and increasing returns to scale under monopolistic competition. We derive involuntary unemployment by considering utility maximization of consumers and profit maximization of firms in an overlapping generations (OLG) model with two or three generations. In a two-periods OLG model it is possible that a reduction of the nominal wage rate reduces unemployment. However, if we consider a three-periods OLG model including a childhood period, a reduction of the nominal wage rate does not necessarily reduce unemployment.

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