In non-market-clearing theories of the labour market,an important explanation for the existence of involuntary unemployment is that labour markets exhibit

Question

Quizplus · Accepted Answer

Rigid or sticky wages in non-market-clearing theories of the labor market can lead to involuntary unemployment. This occurs when wages are slow to adjust downwards in response to a decrease in demand for labor, causing a surplus of workers who are willing to work at the prevailing wage but cannot find employment.

In Non-Market-Clearing Theories of the Labour Market,an Important Explanation for the Existence