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Other figures

Figure 6: Competitive Labor Market Model
\includegraphics[width=6.8in]{fig1newer1.eps}

Utility variables:

\begin{displaymath}
\begin{array}{llllllll}
V^N &=& \textrm{The level of utili...
...e level of utility gained from not working.}\\
\end{array}
\end{displaymath}

The equations for $ V^N$, $ V^S$, and $ V^A$, in terms of the other variables defined thus far:

$\displaystyle V^N$ $\displaystyle = w - e + \frac{(1-q)V^N}{(1+r)}+\frac{qV^A}{(1+r).}$ (5)
$\displaystyle V^S$ $\displaystyle = w + \frac{(1-q)(1-D)V^S}{(1+r)}+\frac{[1-(1-q)(1-D)]V^A}{(1+r).}$ (6)
$\displaystyle V^A$ $\displaystyle = \bar{w} + \frac{sV^N + (1-s)V^A}{(1+r)}.$ (7)



Matthew W. Chesnes 2001-04-24