Resource title

A Kaldor Matching Model of Real Wage Declines

Resource image

image for OpenScout resource :: A Kaldor Matching Model of Real Wage Declines

Resource description

A model linking macroeconomic phenomena and income distribution in balanced growth equilibria is developed as a variant to the Kaldor model of factor shares. It departs from the original Kaldor model in assuming equal savings rates and production determined by a matching process between workers and jobs. Macroeconomic equilibrium (national savings equal to investment) determines the ratio of jobs to employment and the ratio of unemployed to vacancies. Competitive microeconomic behavior then determines the wage and interest rates. Changes in the ratio of national debt to employment have real effects on factor prices. Implications for effects of taxes and unemployment benefits are derived. The model explains recent declines in real wages relative to productivity.

Resource author

Michael Sattinger

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/21240

Resource license

Adapt according to the presented license agreement and reference the original author.