Dynamic Analysis of a Disequilibrium Macroeconomic Model with Dual Labor Markets
Dynamic Analysis of a Disequilibrium Macroeconomic Model with Dual Labor Markets

Author: Shogo Ogawa

Publisher:

Published: 2020

Total Pages: 0

ISBN-13:

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We extend the general disequilibrium model of Malinvaud (1980) by using dual labor market theory. By considering two tiers of workers, we find that while the duality of the labor market expands an equilibrium regime in the short term, it does not always keep an equilibrium in the medium term. In the medium term, the business cycle converges toward a disequilibrium regime unless the goods market is potentially in equilibrium. Employment and wages at the steady state are affected by the size of the government expenditure, and the stability of wage bargaining is only a sufficient condition of the local stability of our dynamic system. Therefore, involuntary unemployment can be remedied only when goods demand is sufficiently large.

Does "Trickle Down" Work?
Does

Author: Joseph Persky

Publisher: W.E. Upjohn Institute

Published: 2004

Total Pages: 190

ISBN-13: 088099309X

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The authors explore a new framework for evaluating economic development projects. This framework is based on a job-chain approach. Each new job created by an economic development incentive is filled by an employee who leaves behind another job. In turn, that job may be filled by someone who leaves behind their old job, etc. Such job chains end when an unemployedworker, someone not previously in the labor force, or an in-migrant to the labor market takes a vacancy. Job chains are the mechanism for observing and measuring "trickle down". The job trains model developed in this book presents new insights into local economic development evaluation and strategy.

Local Labor Markets
Local Labor Markets

Author: Enrico Moretti

Publisher:

Published: 2010

Total Pages: 0

ISBN-13:

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Abstract: I examine the causes and the consequences of differences in labor market outcomes across local labor markets within a country. The focus is on a long-run general equilibrium setting, where workers and firms are free to move across localities and local prices adjust to maintain the spatial equilibrium. In particular, I develop a tractable general equilibrium framework of local labor markets with heterogenous labor. This framework is useful in thinking about differences in labor market outcomes of different skill groups across locations. It clarifies how, in spatial equilibrium, localized shocks to a part of the labor market propagate to the rest of the economy through changes in employment, wages and local prices and how this diffusion affects workers' welfare. Using this framework, I address three related questions. First, I analyze the welfare consequences of productivity differences across local labor markets. I seek to understand what happens to the wage, employment and utility of workers with different skill levels when a local economy experiences a shift in the productivity of a group of workers. Second, I analyze the causes of productivity differences across local labor markets. To a large extent, productivity differences within a country are unlikely to be exogenous. I review the theoretical and empirical literature on agglomeration economies, with a particular focus on studies that are relevant for labor economists. Finally, I discuss the implications for policy