Factor subsidies, employment generation and cost per job: a partial equilibrium approach

D Holden; J K Swales

doi:10.1068/a250317

Factor subsidies, employment generation and cost per job: a partial equilibrium approach

D Holden, J K Swales

Research output: Contribution to journal › Article

8 Citations (Scopus)

Abstract

Factor subsidies in a perfectly competitive setting are analysed. A very general model is used to derive expressions for the effect of a factor subsidy on the price and quantity of output and the two factor inputs. These expressions are differentiated to generate qualitative results for the impact of changes in the product-demand, production-function, and factor-supply parameters on the subsidy effects. A similar procedure is used to investigate the exchequer cost per job of general labour and capital subsidies in an industry with Cobb — Douglas technology. The analysis is relieved with illustrative simulations in which ‘representative’ parameter values are used.

Original language	English
Pages (from-to)	317-338
Number of pages	22
Journal	Environment and Planning A
Volume	25
Issue number	3
DOIs	https://doi.org/10.1068/a250317
Publication status	Published - Mar 1993

Keywords

factor subsidies
capital subsidies
labour

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10.1068/a250317

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abstract = "Factor subsidies in a perfectly competitive setting are analysed. A very general model is used to derive expressions for the effect of a factor subsidy on the price and quantity of output and the two factor inputs. These expressions are differentiated to generate qualitative results for the impact of changes in the product-demand, production-function, and factor-supply parameters on the subsidy effects. A similar procedure is used to investigate the exchequer cost per job of general labour and capital subsidies in an industry with Cobb — Douglas technology. The analysis is relieved with illustrative simulations in which {\textquoteleft}representative{\textquoteright} parameter values are used. ",

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