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Implicit Contracts in the Japanese Bank Loan Market

Published online by Cambridge University Press:  06 April 2009

Extract

The implicit contract theory explored by Azariadis [2] suggests that wage rigidity and underemployment are explained by the microeconomic optimizing behavior of each agent in the labor market. In this theory, the former phenomenon is interpreted as risk-sharing arrangements between firms and workers, whereas the latter may occur when workers have the opportunity to use leisure or unemployment insurance benefits.

Type
Research Article
Copyright
Copyright © School of Business Administration, University of Washington 1985

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