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- Title
LABOR HIRING POLICIES AND MONOPOLISTIC COMPETITION THEORY.
- Authors
McCormick, Brian
- Abstract
The article examines monopolistic competition theory and labor hiring policies during periods of high level employment. According to the author in assuming that the supply of labor is inelastic the wage that might have to be offered would be prohibitive if all firms engaged in a wholesale wage, which causes to lower hiring standards that attracts workers. Employing new workers at a wage above the starting rate in the union agreement or into a job classification higher is another method of lowering hiring standards. The characteristic of a firm in monopolistically competitive market is its reliance on selling costs. The counterpart of expenditures in the labor market is the buying costs. Buying cost makes the supply curve of labor more elastic and reduce average net product of new labor.
- Subjects
MONOPOLISTIC competition; COMPETITION; LABOR supply; SUPPLY &; demand; LABOR market; MARKETS; EMPLOYEE selection; EMPLOYMENT; ECONOMICS; EMPLOYEES
- Publication
Quarterly Journal of Economics, 1959, Vol 73, Issue 4, p607
- ISSN
0033-5533
- Publication type
Article
- DOI
10.2307/1884306