Working paper
The capital stock and equilibrium unemployment: a new theoretical perspective
- Abstract:
-
By assuming Cobb-Douglas production technology, many well-known imperfectly competitive macroeconomic models of the labour market (e.g. Layard, Nickell and Jackman, 1991) imply that equilibrium unemployment is independent of the capital stock. This paper introduces a new notion of capacity into the standard framework. Specifically, we adapt the Cobb-Douglas production function so that when the capital-labour ratio drops below a certain threshold, the returns to labour fall while the returns t...
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- Publication status:
- Published
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Bibliographic Details
- Publisher:
- University of Oxford Publisher's website
- Series:
- Department of Economics Discussion Paper Series
- Publication date:
- 2003-12-01
- Paper number:
- 181
Item Description
- Keywords:
- Pubs id:
-
1144257
- Local pid:
- pubs:1144257
- Deposit date:
- 2020-12-15
Terms of use
- Copyright date:
- 2003
- Rights statement:
- Copyright 2003 The Author(s)
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