Publikationsserver
Efficiency-wage Hypothesis and the Operational Production Pattern
An economy’s production set is the collection of all net output vectors that the economy is capable of producing with a given technology and fixed quantities of primary factors of production. The boundary of this set is called the production possibility frontier or PPF. We show that, if the efficien...
Saved in:
| Published in: | MAGKS - Joint Discussion Paper Series in Economics (Band 46-2011) |
|---|---|
| Main Authors: | , |
| Format: | Work |
| Language: | English |
| Published: |
Philipps-Universität Marburg
2011
|
| Subjects: | |
| Online Access: | PDF Full Text |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| Summary: | An economy’s production set is the collection of all net output vectors that the economy is capable of producing with a given technology and fixed quantities of primary factors of production. The boundary of this set is called the production possibility frontier or PPF. We show that, if the efficiency-wage hypothesis holds, a country’s PPF, though conceptually valid, is an operationally irrelevant concept, because the economy never operates on the PPF, which is a view that ought to be appreciated in light of persistent unemployment in the new structure of economies of the post-21st-Century-crisis world. |
|---|---|
| Physical Description: | 15 Pages |
| ISSN: | 1867-3678 |
| DOI: | 10.17192/es2024.0111 |