Keynes’ arguments on wages and unemployment. …

simultaneous existence of the urban informal sector and the urban unemployment has been explained interms of such efficiency wage … different effects in the two different situations. Interestingly, urban subsidy policies reduces urban unemployment in both of … the two cases, where as rural subsidy policy intensifies the problem of unemployment when urban informal sector is related …

equities, we examine equilibrium unemployment. While a mechanism of an efficiency wage brings about nominal wage rigidity …, unemployment occurring in our model definitely has Keynesian features. For instance, a reduction in wages rather enhances … unemployment through a decrease in consumption. In addition, our paper shows a possibility of Pareto improvement through an …