Elgin, Ceyhun; Kuzubas, Tolga Umut - In: Economics: The Open-Access, Open-Assessment E-Journal 7 (2013) 2013-21, pp. 1-21
The Walrasian theory of labor market equilibrium predicts that in the absence of any market frictions, workers earn a wage rate equal to their marginal productivity. In this paper, based on the neoclassical tradition, the authors define the ratio of the marginal product of labor to real wages as...
