Bargaining frictions and hours worked
By: by Stéphane Auray, Samuel Danthine.
Contributors: Danthine, Samuel.
Series: Discussion paper ;; no. 1722; Discussion paper (Forschungsinstitut zur Zukunft der Arbeit : Online) ;; no. 1722
Publisher: IZA
Published: 2005
Place of publication: Bonn, Germany
Language: eng
Format: Electronic resource
Subjects: Gross domestic product -- Case studies.; Part-time employment -- Case studies.; Employment -- Case studies.; Income tax -- Case studies.
Genres: Case studies.
Description: "A matching model with labor/leisure choice and bargaining frictions is used to explain (i) differences in GDP per hour and GDP per capita, (ii) differences in employment, (iii) differences in the proportion of part-time work across countries. The model predicts that the higher the level of rigidity in wages and hours the lower are GDP per capita, employment, part-time work and hours worked, but the higher is GDP per hours worked. In addition, it predicts that a country with a high level of rigidity in wages and hours and a high level of income taxation has higher GDP per hour and lower GDP per capita than a country with less rigidity and a lower level of taxation. This is due mostly to a lower level of employment. In contrast, a country with low levels of rigidity in hour and in wage setting but with a higher level of income taxation has a lower GDP per capita and a higher GDP per hour than the economy with low rigidity and low taxation, because while the level of employment is similar in both economies, the share of part-time work is larger"--Forschungsinstitut zur Zukunft der Arbeit web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 8/30/2005.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.