Document Type

Working Paper

Journal/Book Title/Conference

Journal of Post-Keynesian Economics

Volume

20

Article

1087

Issue

2

Pages

295-299

Publication Date

10-1990

Department or Program

Economics Department

Abstract

It is commonly believed that firms prefer layoffs to worksharing, in part, because layoffs economize on fringe benefit costs. We find that when labor markets are characterized by optimal implicit contracts, layoffs will never occur in equilibrium, regardless of the level of fringe benefits.

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