TY  - JOUR
AU  - Greenwald,Bruce
AU  - Stiglitz,Joseph E.
TI  - Pareto Inefficiency of Market Economies:  Search and Efficiency Wage Models
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 2651
PY  - 1989
Y2  - April 1989
UR  - http://www.nber.org/papers/w2651
L1  - http://www.nber.org/papers/w2651.pdf
N1  - Author contact info:
Joseph E. Stiglitz
Uris Hall, Columbia University
3022 Broadway, Room 814
New York, NY  10027
Tel: 212/854-0671
Fax: 212/662-8474
E-Mail: jes322@columbia.edu
AB  - This paper shows that market economies with search and in which wages are affected by efficiency wage considerations are not constrained Pareto efficient. Wages are not set at Pareto efficient levels, nor is the level of employment (unemployment) Pareto efficient. We identify the nature of the biases and the welfare improving government interventions.
ER  -