Minimum Wages and Welfare in a Hotelling Duopsony

Two firms choose locations (non-wage job characteristics) on the interval [0,1] prior to announcing wages at which they employ workers who are uniformly distributed; the (constant) marginal revenue products of workers may differ. Subgame perfect equilibria of the two-stage location-wage game are studied under laissez-faire and under a minimum wage regime. Up to a restriction for the existence of pure strategy equilibria, the imposition of a minimum wage is always welfare-improving because of its effect on non-wage job characteristics.duopsony, minimum wages, hotelling

Imperfectly Competitive Cycles with Keynesian and Walrasian Features

We consider a multi-sector overlapping generations model with imperfectly competitive firms in the output markets and wage setting trade unions in the labour markets. A coordination problem between firms creates multiple temporary equilibria which are either Walrasian or of the Keynesian unemployment type. There exist many deterministic and stochastic equilibrium cycles fluctuating between Keynesian recession and Walrasian boom periods with arbitrarily long phases in each regime. The cycles are in accordance with certain empirical regularities. Money is neutral and superneutral, but appropriate countercyclical fiscal policies stabilize the cycles in a textbook Keynesian way.Endogenous business cycles, Imperfect competition, Stabilization policy

Diversity in Central Asia: Culture, transition & entrepreneurship

With the demise of the USSR in 1991, five new countries became independent in Central Asia. This study presents an overview about transition, emergence and nature of entrepreneurship in a world’s region that displays amongst the most important energy resources in gas and oil