INSURANCE-MARKETS EQUILIBRIUM WITH A NON-CONVEX LABOR SUPPLY DECISION,
UNOBSERVABLE EFFORT, AND EFFICIENCY WAGES OF THE “NO-SHIRKING” TYPE
INSURANCE-MARKETS EQUILIBRIUM WITH A NON-CONVEX LABOR SUPPLY DECISION,
UNOBSERVABLE EFFORT, AND EFFICIENCY WAGES OF THE “NO-SHIRKING” TYPE
Author(s): Aleksandar VasilevSubject(s): Economy, Supranational / Global Economy
Published by: ASERS Publishing
Keywords: indivisible labor; lotteries; unobservable effort; no-shirking; efficiency wages; insurance;
Summary/Abstract: The purpose of this paper is to describe the lottery and insurance-market equilibrium in an economy with non-convex labor supply decision, unobservable effort, and efficiency wages of the no-shirking type a la Shapiro and Stiglitz (1984). The presence of indivisible labor creates a market incompleteness, which requires that an insurance market for (un) employment be put in operation to "complete" the market.
Journal: Theoretical and Practical Research in Economic Fields (TPREF)
- Issue Year: X/2019
- Issue No: 19
- Page Range: 28-34
- Page Count: 9
- Language: English
- Content File-PDF
