Oligopoly model reveals link between unemployment and imperfect competition
The article explores how unemployment can be influenced by both labor market imperfections and producers' behavior in an oligopoly setting. By extending the Cournot oligopoly model to include labor market dynamics, the researchers show how the interaction between labor and product markets can impact employment levels. The study suggests that a general equilibrium approach is needed to understand these complex relationships, drawing on theories of demand curves and non-Walrasian equilibrium. The findings highlight the importance of considering both subjective and objective factors in economic decision-making, and how wage levels can affect short-run equilibrium in the economy.