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This paper presents a positive model which shows that institutional setups on capital and labor markets might be intertwined by politicoeconomic forces. Two politicoeconomic equilibria arise from our model, one with little protection of insiders on capital and labor markets, and another one with...
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Conventional theory predicts that productivity gains lead to hikes in real pay. Efficiency wage theory hypothesizes … efficiency benefit of corporatism. For laborers in manufacturing, we find that wage hikes result in productivity gains. Managers …
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