TY  - JOUR
AU  - Kimball,Miles S.
TI  - Labor Market Dynamics When Unemployment Is A Worker Discipline Device
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 2967
PY  - 1989
Y2  - May 1989
UR  - http://www.nber.org/papers/w2967
L1  - http://www.nber.org/papers/w2967.pdf
N1  - Author contact info:
Miles S. Kimball
Department of Economics
University of Michigan
Ann Arbor, MI  48109-1220
Tel: 734/764-2375
Fax: 734/764-2769
E-Mail: mkimball@umich.edu
AB  - Efficiency wage models of the effort elicitation type have important implications for labor market dynamics. These models have a wide array of discontinuous sunspot equilibria driven by extraneous variables, in addition to well-behaved equilibria characterized by continuous, slowly adjusting patterns of employment. Many aspects of actual labor markets can be replicated by these models. For example, the longer-run movements they predict in employment allow macroeconomic evidence for a large labor supply elasticity to be reconciled with panel data evidence for a small labor supply elasticity. Many testable, but as yet untested predictions about labor market dynamics can also be generated.
ER  -