Money, Banks and Finance in Economic Thought

Robert Solow on labor economics in the 1980s

Leray Benjamin, Paris 1

On the basis of his archives and his published works, we propose to clarify the role played by Robert Solow in the emergence of new labor market theories from the late 1970s to the late 1980s. The study of Solow's archives, starting with his correspondence with labor economists in the 1980s, reveals that he took a prominent place in the debates on the concept of involuntary unemployment and on the causes of wage rigidity. The main aim of our contribution will be to clarify the overall consistency of Solow’s works in labor economics (Solow, 1979, 1981, 1985, 1990). We want to demonstrate that the various approaches he tried from 1979 to 1990 are unified by the belief that unemployment persistence is the result of the fact that unemployed are prevented to underbid their wages. We also show study the interaction between the ideas developed by Solow concerning the working of the labor market and the ideas developed by Azariadis, Akerlof, Yellen, Lindbeck and Snower.

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Keywords: Solow ; Involuntary unemployement ; Labor market ;

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