A Theory of Employment in Firms: Macroeconomic Equilibrium and Internal Organization of Work (Contributions to Economics)

In a modern economy, production and competition require internal interaction of individuals in firms. The book provides a systematic treatment of the macroeconomic consequenses of this fact. For this purpose the concept of a two-stage monopolistic competition equilibrium is introduced into macroeconomic theory. Firms choose the capacity to organize internal interaction at stage 1 and compete at stage 2. The concept allows a rigorous analysis of the provision of work places and the economic determinants of the employable work force. The book explains why in the equilibrium of a market economy, even under flexible wages, no jobs may be provided for people who are employable from an efficiency point of view. The economic determinants of equilibrium employment covered by the analysis of the book are: New forms of work organization, changes in the skill structure of the labor force, market power of key factors for organization, expectations of investors and international capital movements. Front Matter....Pages I-X Introduction....Pages 1-11 The basic model....Pages 13-33 Unemployability and involuntary unemployment....Pages 35-55 Equilibrium reorganization of work and aggregate level of employment....Pages 57-83 Skilled and unskilled labor....Pages 85-115 Capital and the provision of work places....Pages 117-149 Investment and savings. Supply-side vs. demand-side macroeconomic equilibria....Pages 151-176 Summary....Pages 177-188 Back Matter....Pages 189-206 An observer of current trends may be left with the impression that the success of the winners is all what economics is about.