Econometrica: Jul 1979, Volume 47, Issue 4
An Equilibrium Model with Fixed Labor Time
Claus WeddepohlAn economy with production is considered where the labor time is the same for all working agents and for all types of labor. It is shown that a private goods equilibrium exists if the labor time is fixed. An equilibrium with public goods exists if the labor time is variable but the distribution of consumers over types of labor is given, where labor time appears as a public good. Optimality properties of solutions where the equilibrium conditions of both types of equilibrium are fulfilled simultaneously are analyzed.
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