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If people's labor-supply decisions are taken at the level of the household, it is natural to expect aggregate demand and unemployment to influence the supply curve of labor. An increase in unemployment could prompt households to send more workers out in search of work to insure against the risk...
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theory and the efficiency wage theory. The basic thesis of the paper is that the former set of theories do not provide a …. Several of the more recent versions of implicit contract theory are considered: implicit contracts with asymmetric information …, explicitly long term in nature, may give rise to full employment. One version of implicit contract theory which does give rise to …
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