%0 Report
        %A Koskela, Erkki
%A Stenbacka, Rune
        %T Profit Sharing, Credit Market Imperfections and Equilibrium Unemployment
        %D 2004
        %8 2004 Feb
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 1020
        %U https://www.iza.org/publications/dp1020
        %X We investigate the interaction between labour and credit market imperfections for equilibrium unemployment in the presence of profit sharing. In a partial equilibrium with exogenous outside options increased bargaining power of banks has adverse employment effects. In a general equilibrium with endogenous outside options this relationship is frequently reversed; reduced credit market imperfections increase equilibrium unemployment if the labour market imperfections – measured by the bargaining power of trade unions - are sufficiently strong and benefit-replacement ratio high enough. Finally, we show that higher bankruptcy risks increase equilibrium unemployment under similar conditions.
        %K equilibrium unemployment
%K compensation systems
%K wage and loan bargaining
%K outside options