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dc.contributor.authorGuerrazzi, Marcoen_US
dc.description.abstractThis paper aims to represent wage bargaining as an optimal control problem. Specifically, by assuming that employment follows a stock adjustment principle towards the level that maximises profits, i.e., towards labour demand, we build an intertemporal optimising model in which the real wage is continuously set by an infinitely-lived omniscient arbitrator that is called in to resolve the dispute between the workers and the employers. Our theoretical proposal allows to show that unions may speed up the adjustment to equilibrium and it suggests that standard (static) models may understate the distortions implied by wage bargaining.en_US
dc.publisherEconomics Department, Faculty of Social Sciences, the Open Univ. Milton Keynesen_US
dc.relation.ispartofseriesOpen Discussion Papers in Economics, The Open University 61en_US
dc.subject.keywordWage Bargainingen_US
dc.subject.keywordOptimal Control Theoryen_US
dc.subject.keywordRight-to-Manage Modelen_US
dc.subject.keywordNumerical Solutionsen_US
dc.subject.stwMathematische Optimierungen_US
dc.titleWage bargaining in an optimal control framework: A dynamic version of the right-to-manage modelen_US
dc.typeWorking Paperen_US
Appears in Collections:Open Discussion Papers in Economics, The Open University

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