Research On Employment Probability Influences Labor Supply Curve Under Wage Stickiness Term

Recent theoretical research on labor supply is based on Neo-classical theories. The Neo-classical decision model of labor supplies assumes that price can be adjusted randomly, which means labor market will achieve balance in the end and the same with employment probability. But the truth is that prices always cannot be adjusted. We need rethink the applicability of Neo-classical decision model.This paper defines that employment probability has two different economic utilities, one is defined as wage utility and another one is defined as supply utility. The basic proposition is that wage stickiness is necessary and sufficient condition of supply utility. This paper use two steps to prove that. Firstly, we prove that if there is no wage stickiness, we can get wage utility, otherwise, we can get supply utility.Based on above, this paper adjusts the labor supply model and labor supply curve. Firstly, labor supply function is a two-mention function: Q(L)=f(p,W); Secondly, personal maximization of utility can be achieved only when the ratio of labor supply and leisure marginal utility equal to expected revenue R. Finally, we get a new labor supply model and labor supply curve under wage stickiness condition.Anyway, through this paper we found a new way to understand wage stickiness condition on labor supply, which has a meaningful value for the theoretical research. This paper has19pictures,8forms and71references.