TY - JOUR
T1 - The remuneration package and pareto inefficiency in the labour market
AU - Katz, Eliakim
AU - Spiegel, Uriel
AU - Ziderman, Adrian
PY - 1986/12
Y1 - 1986/12
N2 - This paper argues that a simple wage payment system relating wages to hours of work supplied cannot bring about Pareto efficiency in the labour market and that in its search for efficiency, the labour market has evolved an alternative pricing system that differs from those generally found in other markets. Specifically, it is demonstrated that whereas Pareto efficiency will in general be absent in the labour market when a single price system prevails, a labour reward package consisting both of a fixed payment element unrelated to hours of work supplied and a work-input related wage element is likely to bring about Pareto efficiency.
AB - This paper argues that a simple wage payment system relating wages to hours of work supplied cannot bring about Pareto efficiency in the labour market and that in its search for efficiency, the labour market has evolved an alternative pricing system that differs from those generally found in other markets. Specifically, it is demonstrated that whereas Pareto efficiency will in general be absent in the labour market when a single price system prevails, a labour reward package consisting both of a fixed payment element unrelated to hours of work supplied and a work-input related wage element is likely to bring about Pareto efficiency.
UR - http://www.scopus.com/inward/record.url?scp=46149129962&partnerID=8YFLogxK
U2 - 10.1016/s0014-2921(86)80014-9
DO - 10.1016/s0014-2921(86)80014-9
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AN - SCOPUS:46149129962
SN - 0014-2921
VL - 30
SP - 1197
EP - 1205
JO - European Economic Review
JF - European Economic Review
IS - 6
ER -