Nutritional Efficiency Wages and Unemployment: Where's the Beef?

American Journal of Agricultural Economics Advance Access, September 2014

9 Pages Posted: 6 Sep 2014

See all articles by Benjamin Powell

Benjamin Powell

Texas Tech University - Free Market Institute; Texas Tech University - Rawls College of Business

Ryan Murphy

Southern Methodist University (SMU)

Date Written: September 2, 2014

Abstract

We modify the standard nutritional efficiency wage model to allow for the fact that employers can directly provide calories to their workers rather than paying a higher wage to induce employees to spend more on their own caloric consumption. We derive the various theoretical outcomes that are possible depending on the assumptions about the transaction costs of directly providing calories. We argue that in most real-world situations the ability of employers to directly provide calories undermines the traditional efficiency wage theory as a cause of equilibrium unemployment.

Keywords: Efficiency wages, nutrition and economic development, unemployment

JEL Classification: J43, J64, O10, Q1

Suggested Citation

Powell, Benjamin and Murphy, Ryan, Nutritional Efficiency Wages and Unemployment: Where's the Beef? (September 2, 2014). American Journal of Agricultural Economics Advance Access, September 2014. Available at SSRN: https://ssrn.com/abstract=2491711

Benjamin Powell (Contact Author)

Texas Tech University - Free Market Institute ( email )

Box 45059
Lubbock, TX 79409-5059
United States
806.742.7138 (Phone)
806.742.1854 (Fax)

HOME PAGE: http://www.fmi.ttu.edu

Texas Tech University - Rawls College of Business ( email )

Lubbock, TX 79409
United States
806.834.3097 (Phone)
806.742.1854 (Fax)

Ryan Murphy

Southern Methodist University (SMU) ( email )

6212 Bishop Blvd.
Dallas, TX 75275
United States

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