Real options, wage bargaining, factor subsidies and employment

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Abstract:

The paper combines a translog variable cost function, a bargaining model of wage determination and a real option model determining real capital. Using this framework, the effect of factor subsidies on labour demand is estimated, based on aggregate panel data for Norwegian manufacturing industry in the period 1980 - 1988

Document Type: Research Article

DOI: http://dx.doi.org/10.1080/000368498325859

Publication date: March 1, 1998

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