Munich Personal RePEc Archive

Efficiency wage setting, labor demand, and Phillips curve microfoundations

Campbell, Carl (2011): Efficiency wage setting, labor demand, and Phillips curve microfoundations.

There is a more recent version of this item available.
[thumbnail of MPRA_paper_74910.pdf]

Download (713kB) | Preview


This study demonstrates that a model with efficiency wages and imperfect information produces a Phillips curve relationship. Equations are derived for labor demand and the efficiency wage-setting condition, and shifts in these curves in response to aggregate demand shocks result in a relationship with the characteristics of a Phillips curve. The Phillips curve differs from the efficiency wage-setting condition in that the Phillips curve is a more parsimonious expression and has a coefficient on expected inflation equal to 1. Also derived from this model is the counterpart curve to the Phillips curve in unemployment – inflation space.

Available Versions of this Item

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.