Dossche, Maarten; Lewis, Vivien; Poilly, Céline - 2015
satisfy demand in the short run by adjusting hours per worker. Imperfect product market competition and search frictions … reduce steady state hours per worker below the efficient level. Bargaining results in a convex 'wage curve' linking wages to … hours. Since the steady-state real marginal wage is low, wages respond little to hours. As a result, firms overuse the hours …