Efficiency wage models and implicit labor contracts: A survey

Date

1994

Author

Kazemi, Abbas A.

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Recent analysis of determination of wages and employment has been carried out in the framework of efficiency wage models and long-term implicit labor contracts instead of the continuous-action models. This paper attempts to present a thorough survey of this area. We review the literature that deals with the notion of risk sharing and insurance aspects of the implicit contracts. Using Azariadis (1975) as a basic frame of reference, the issues of worker heterogeneity and imperfect information about prices and productivity are examined. The study also addresses the role and implications of asymmetric information problem within the contract environment.

URI

https://hdl.handle.net/11511/108311

Collections

Department of Economics, Article