Wednesday, January 18, 2012

sticky wages

this is still the  spinal element in most macro interventionists models

and its wrong

there is much more sub maxima unstable forces at work

capitalism ...corporate capitalism is systemically irrational
the performance less then a better arrangement of production could achieve

however only comparative dynamics can establish this

not comparative statics

its dynamic performance that institutional arrangements  impact

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corporate set prices both at the list level and the transaction level
do what they do
and produced quantities are what they are

 because that set of choices looks most profitable and is also ....feasible
 at the moment of decision

wages ??
they trail along for the ride these days


none of these dynamics are  yet  modeled of course or simulated

and feasibility has a great deal  to do with credit flows and equity holder scrutiny