The purpose of this paper is to examine the cyclical consequences of Efficiency Wage theory when changing the workers efforts based on Dynamic Real Business Cycle model by using the data collected during 1966-2014. The equations are estimated through oleic approach (199 More
The purpose of this paper is to examine the cyclical consequences of Efficiency Wage theory when changing the workers efforts based on Dynamic Real Business Cycle model by using the data collected during 1966-2014. The equations are estimated through oleic approach (1999) as a space-state model in MATLAB context. The results represent that the increase of efforts variability to efficiency wage consideration causes the variables like production, consumption, labor and employment rate react less to technology shock. According to this model, higher level of workers efforts will lead to the increase of employment rate.
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