pull down to refresh
Aren't labor protections asymmetric? What would be the equivalent on the other side?
I just woke up, so maybe my brain is missing something obvious.
reply
I think I meant that absent artificial frictions like labor protections, the impacts would be symmetric.
But even with labor protections, I imagine that some kind of equivalence would still result under rational expectations models. I don't think it's obvious, it's more like my intuition tells me that only one allocation of surplus would be admissible in equilibrium
reply
I think I see what you're getting at. Do you think differences in risk aversion between firms and workers would actually make the incidence matter?
reply
I'm almost certain that under a frictionless competitive model you'd be able to derive some kind of equivalence result, similar to equivalence of tax incidence in competitive markets.