I think all these sort of fail on the basis of partial equilibrium rather then general equilibrium but here are a few thought that may or may not fit somewhere.
1. Is a bit of a Say’s Law take. One thing that might be considered is just how quickly the realized new demand from increased wages (and how quickly some might react in terms of quantity of labor employed is reduced) transmits thought the local economy. If demand propagates quickly, 1 might hold.
2. That’s an interesting approach. Could increased wages result in increased investment in human capital? Maybe, maybe not. An interesting historical debate might come back here. The old Cambridge Capital Controversy, as it was explained to be once, basically supports a multi equilibrium outcome. One is a high wage equilibrium with a low return to capital (the w and r in the model). While the debate was supposed to be been resolved and so the two outcomes not possible I never got the sense that all agreed so perhaps there might be something there.
3. Was a theory called Efficiency Wages.
All that said, I think the biggest problem with wage theory for economics is that “wages” are not really set as much in the market as in the corporate HR office. This is not to say that there is not linkage to external markets, but borrowing from old monetary policy terms, is only loosely linked. Within a medium to large (and probably even what would be called small these days) corporation the effort is very much a complex joint production activity and margins are poorly understood (and probably not even known in a lot of cases). The standard micro economic analysis only goes so far. The margin really should be some unit output from the corporate effort. Wages then become more a political economy setting where the issue is more distribution and less about allocation. (Include all the thinking about need for “slack” for productivity...)
I think all these sort of fail on the basis of partial equilibrium rather then general equilibrium but here are a few thought that may or may not fit somewhere.
1. Is a bit of a Say’s Law take. One thing that might be considered is just how quickly the realized new demand from increased wages (and how quickly some might react in terms of quantity of labor employed is reduced) transmits thought the local economy. If demand propagates quickly, 1 might hold.
2. That’s an interesting approach. Could increased wages result in increased investment in human capital? Maybe, maybe not. An interesting historical debate might come back here. The old Cambridge Capital Controversy, as it was explained to be once, basically supports a multi equilibrium outcome. One is a high wage equilibrium with a low return to capital (the w and r in the model). While the debate was supposed to be been resolved and so the two outcomes not possible I never got the sense that all agreed so perhaps there might be something there.
3. Was a theory called Efficiency Wages.
All that said, I think the biggest problem with wage theory for economics is that “wages” are not really set as much in the market as in the corporate HR office. This is not to say that there is not linkage to external markets, but borrowing from old monetary policy terms, is only loosely linked. Within a medium to large (and probably even what would be called small these days) corporation the effort is very much a complex joint production activity and margins are poorly understood (and probably not even known in a lot of cases). The standard micro economic analysis only goes so far. The margin really should be some unit output from the corporate effort. Wages then become more a political economy setting where the issue is more distribution and less about allocation. (Include all the thinking about need for “slack” for productivity...)