Employment, Salary And Stochastic Economic Growth

In this paper, we mainly analyses the condition of two markets, including labor market and capital market. We get a model on these two markets to get a series of conclusion about salary and welfares of employees. There're four parts in the paper. In the first part, it introduces the development economic growth and the approach of the analysis. And in the third knot, the specified stochastic model is given. And this includes the main approach for the later part. In the second part, it gives a deterministic model. It analyses the demand and supply of the labor market and capital market, and then we get the problem of employee and employer. In the equilibrium conditions, we get the expression for the optimized salary and welfare. In the third part, it has a stochastic model for analysis. The expression of the salary can be got in the model, and the welfare analysis follows. In the model, people are divided into employment, changing the job and unemployment, and the job is divided into empty and full. And then we have a matching analysis. When the salary and the investment in labor are steady, we maximize the profits of the people and get the optimized salary. The forth part is different to the third one, because the salary is not steady but obeys to a continuous distribution function. To solve the problem of optimization, we get a more sensitive expression of salary and average welfare. The purpose of this paper is to get the relationship for some salary to employment and salary. According to this analysis, we can get some suggestion on economic policy.