Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/170575
Authors: 
Vasilev, Aleksandar
Year of Publication: 
2017
Citation: 
[Journal:] Central European Journal of Economic Modelling and Econometrics [ISSN:] 2080-119X [Issue:] forthcoming
Abstract: 
In this paper we investigate the quantitative importance of e fficiency wages in explaining fluctuations in Bulgarian labor markets. This is done by augmenting an otherwise standard real business cycle model a la Long and Plosser (1983) with unobservable workers e ort by employers and wage contracts as in Shapiro and Stiglitz (1984), as well as a detailed government sector. This imperfection in labor markets introduces a strong propagation mechanism that allows the model to capture the business cycles in Bulgaria better than earlier models. The model performs well vis-a-vis data, especially along the labor market dimension, and in addition dominates the market-clearing labor market framework featured in the standard RBC model, e.g Vasilev (2009).
Subjects: 
general equilibrium
shirking
efficiency wages
unemployment
Bulgaria
JEL: 
E24
E32
J41
Document Type: 
Article

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