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|Testing for a U-Shaped Wage Curve. A Response
Oswald, Andrew J
|Blanchflower D & Oswald AJ (1993) Testing for a U-Shaped Wage Curve. A Response. Scandinavian Journal of Economics, 95 (2), pp. 245-248. http://www.jstor.org/stable/3440410
|First paragraph: Sessions (1993) has written an interesting theoretical note in which he provides a possible analytical justification for a "wage curve" that is U-shaped. His idea is to incorporate the stigman of unemployment into the kind of bargaining model set out in Blanchflower and Oswald (1990). In Sessions' framework, once the unemployment rate becomes sufficiently high, and thus individuals believe it is socially acceptable to be without a job, unemployment fails to dampen wage pressure.
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