Unemployment has been a topic under great controversy in economics, with many researchers devoting their lives in an attempt to maximize efficiency in terms of employment and productivity. This review will explore the various theoretical approaches to unemployment made by researchers in the years leading up to 2000.
The first academic journal in review is “The implicit contract theory of unemployment meets the wage bill argument” by George A. Akerlof and Hajime Miyazaki. The authors published the academic journal in 1980. The paper focuses on challenging theories of the arguments stating that “the smoothing of wages caused by implicit contract results in non-walrasian fluctuations in employment.” 1 The researchers also question this …show more content…
The researchers sought out to answer this question by creating a general equilibrium model and correlate it to the Canadian economy.2 They would then consider various factors that could potentially have an effect on the Canadian economy, whether it was unemployment insurance (EI), increases in layoff costs, lower rates of productivity, etc. 2 The researchers use the poisson distribution formula to help explain and test unemployment rate factors from the family/household perspective. They also tested the effects of unemployment from the firm 's point of view, who employ both capital and labour, by using the Cobb-Douglas production function.2 The paper is inconsistent with their testing, because in several different areas of the paper, they are missing data, and rely on other data used in other work, which may not use the same analysis testing or use the exact same testing method(s). This inconsistency can be found in the quantitative analysis section of the paper. The paper also fails to recognize government legislation and outside factors that can influence or cause the testing to be inaccurate or misleading. This can be a large issue, because it can mislead researchers to utilize data incorrectly, or misinterpret the results, causing testing methods to be potentially completely inaccurate. The researchers found that it is very unlikely that there is a model that can explain the unemployment rate in the long
The first academic journal in review is “The implicit contract theory of unemployment meets the wage bill argument” by George A. Akerlof and Hajime Miyazaki. The authors published the academic journal in 1980. The paper focuses on challenging theories of the arguments stating that “the smoothing of wages caused by implicit contract results in non-walrasian fluctuations in employment.” 1 The researchers also question this …show more content…
The researchers sought out to answer this question by creating a general equilibrium model and correlate it to the Canadian economy.2 They would then consider various factors that could potentially have an effect on the Canadian economy, whether it was unemployment insurance (EI), increases in layoff costs, lower rates of productivity, etc. 2 The researchers use the poisson distribution formula to help explain and test unemployment rate factors from the family/household perspective. They also tested the effects of unemployment from the firm 's point of view, who employ both capital and labour, by using the Cobb-Douglas production function.2 The paper is inconsistent with their testing, because in several different areas of the paper, they are missing data, and rely on other data used in other work, which may not use the same analysis testing or use the exact same testing method(s). This inconsistency can be found in the quantitative analysis section of the paper. The paper also fails to recognize government legislation and outside factors that can influence or cause the testing to be inaccurate or misleading. This can be a large issue, because it can mislead researchers to utilize data incorrectly, or misinterpret the results, causing testing methods to be potentially completely inaccurate. The researchers found that it is very unlikely that there is a model that can explain the unemployment rate in the long