6533b854fe1ef96bd12ae7de
RESEARCH PRODUCT
Fair Wages and Unemployment in a Small Open Economy
Steffi SchonwaldUdo KreickemeierUdo KreickemeierUdo Kreickemeiersubject
Labour economicsDomestic labourEndowmentmedia_common.quotation_subject05 social sciencesSmall open economyFactor price0502 economics and business8. Economic growthUnemploymentEconomicsProduction (economics)050207 economicsInvoluntary unemployment050205 econometrics media_commondescription
In this paper we develop a model of a multi-sector multi-factor small open economy with involuntary unemployment due to fair wages. The model is used inter alia to analyse the labour market effects of changes in unemployment benefits and the domestic labour supply. Our analysis covers both the case where factor prices do not react to endowment changes - as in the Heckscher-Ohlin model - and the case where they do. Results are sensitive to this distinction, thereby emphasizing the benefit of employing a general production structure that encompasses both cases.
| year | journal | country | edition | language |
|---|---|---|---|---|
| 2006-01-01 | SSRN Electronic Journal |