# Symbols

**In general, uppercase English-alphabet symbols indicate variable levels, while lowercase indicates rates of change. **

**å** is the nonstationary LEV capital-labor ratio (*Ƙ*^{T}_{J}/*H*^{T}_{J}).

**ã **denotes the LEV ratio of sunk to total capital (*Ƙ*^{S}_{J}/*Ƙ*_{J})

**ä** denotes the LEV workweek (*H*_{J}/*N*_{J}).

**Б ^{Ş}** represents the average productivity of labor input in the Lewis subsistence sector (Chapter 3).

**Б ^{Ĭ}** measures average labor-productivity (posited to be constant) in the Lewis-model’s industrial venue (Chapter 3).

**Ç** denotes total nominal consumption spending.

**₡ **represents revealed investor confidence, generated by Roger Farmer’s (2010) feedback interaction with the equity prices. (See Chapter 6.)

**Ƈ** is a notional measure of investor/lender perceptions of the creditability of the real-side objective of stabilization authorities. It is monotonically increasing in the degree to which the future states of the macroeconomy are plausibly consistent with the known objectives of the stabilization authority, working through unpriceable depression risk to introduce uncertainty into investor/lender decision-making.

**Ĉ** denotes LEV firms’ desired unused production capability.

**Ḍ **represents job separations in the S/M/B model.

**Є **is LEV production capability (*Є*(t)=*X*(t)+*Ĉ*(t)≤*X*^{P}(t)), typically decomposed into its stationary (*Є*^{V}) and nonstationary (*Є*^{T}) components. In the former, labor hours are temporarily adjusted to the stationary movement in nominal demand. In the latter, labor hours and capital stock are permanently adjusted to nonstationary demand movements.

**Э** denotes the LEV capital utilization rate (*Э*=*Ƙ*/*Ƙ*^{P}).

**Έ** denotes, in the given work establishment, labor cooperative effort that is restricted to be in 1-1 technical correspondence with production (*X*), *Έ*(t)=*Έ*^{Q}(t)+*Έ*^{G}(t)+*Έ*^{S}(t). *Έ*^{Q}_{j} measures the contribution from the unenhanced employee hours; *Έ*^{G}_{j }denotes the contribution from general human capital; *Έ*^{S}_{j} the contribution from firm-specific human capital.

**ƒ **is the generic designation of a mathematical function used throughout the analysis.

**G** denotes the ratio of the efficiency/reference wage (*W*^{n}) to labor market-opportunity costs (*W*^{m}); **Ǥ **equals (W^{n}/W^{m})−1.

**Ɠ **is the upper limit on wage dispersion (*G*≤*Ɠ*) that is consistent with durable **Ҝ**_{j}.

**Ģ _{S}** is total nominal government spending.

**Ģ _{τ}** is total nominal government tax revenue.

**H **denotes labor hours at work.

**Ḥ** is new hires in the S/M/B model.

**Ӈ **denotes the hold-up problem, increasing in the expected cost of the problem.

**Į** is total nominal investment spending.

**J **denotes the large-establishment venue (LEV).

**j** denotes the representative firm in the large-establishment venue.

**Ƙ **denotes the flow of capital-input services from the capital stock (*Ҡ*); **ҡ **is its rate of change.

**Ƙ ^{P}** is the maximum flow of capital-input services available from the capital stock (

*Ҡ*).

**Ҡ **is the capital stock, valued at original cost and equaling *Ҡ*^{S}+*Ҡ*^{r}; **ҡ **is the rate of change of the capital stock.

**Ҡ**^{Ṛ} is the replacement cost of the establishment’s capital (*Ҡ*).

**Ҡ ^{r}** is the resale value of the capital stock (

*Ҡ*), which (for convenience) is always debt-financed.

**Ҡ ^{S}** denotes sunk capital, which due to firm-specificity has no market-opportunity costs; as a result, Ҡ

**is always equity-financed.**

^{S}**Ҝ**_{j} represents establishment-specific workplace (social) capital. Three classes of worker reference standards – the best alternative-job (denoted by *a*) interpersonal (*b*), and inter-temporal (*c*) – that calibrate his or her inherent preference for fair treatment by management are the elements in the set** Ҝ**_{j}={*W*^{a}_{j},*W*^{b}_{j},*W*^{c}_{j}}. **Ҝ**_{J} denotes venue reference standards.

**Ҝ**^{n} represents inactive reference-wage calibration, during which **Ҝ**_{j} or **Ҝ**_{J} is durable.

**Қ ^{Ṛ}_{j}** is the replacement cost of the establishment’s sunk capital.

**K** denotes the large-establishment venue (LEV).

**k **denotes the representative firm in the small-establishment venue.

**ķ **is the period required for the catch-up to price inflation that has already occurred in the rational periodic adjustment of nominal wages.

**Ḽ** represents total labor supply, i.e. the sum of persons employed or unemployed and actively seeking employment.

**ℓ** is the rate of change in labor supply.

**ƛ** is the adjustment coefficient (0<ƛ<1) used in the Early Keynesian adaptive expectations variant of the Phillips curve.

**M** denotes total money supply.

**ɰ **denotes the efficiency of the aggregate matching function in S/M/B modeling.

**N** is total employment.

**Ѳ **denotes expected duration of employment.

**φ **is the profit mark-up over variable costs in product pricing.

**P** is the product-price index.

**P ^{Ш}** is its unit price of (homogeneous) material input.

**₱** denotes working-age population.

**p ^{e}** is inflation expectations (used in some Phillips-Curve formulations).

**P _{Ƙ} **is the purchase price of physical capital

**Ƙ**

_{j}.

**p _{Ł}** denotes the lagged product-price inflation rate that rationally informs periodic nominal wage setting.

**p ^{N} **is the central bank’s product-price inflation regime.

**p ^{T} **is nonstationary (trend) product-price inflation.

**Π** denotes pure profits, i.e., economic rents claimed by owners of sunk capital (*K*^{S}_{j}) that are the firm’s residual revenue after the rational payment for required inputs (labor hours, financial capital, and materials input) and taxes.

**И** represents expected real discounted pure profits (*Π*), predicated on the assumption of known probabilities with respect to future states of the macroeconomy.

**И ^{ѓ} **is the rate of return required for a positive decision on an investment outlay.

**q** is defined as И/Ҡ^{S}, the expected rate of return on sunk capital.

**ř ^{m}** is the market interest rate.

**ῥ **denotes the rate of change of labor productivity.

**Ş** denotes aggregate nominal saving, such that Ş(t)=Y(t)−Ç(t).

**Ṣ _{H} **is labor’s share in SVGE growth accounting.

**Ṣҡ **is capital’s share in SVGE growth accounting.

**Ʈ** denotes the government tax rate.

**U** denotes the unemployment rate.

**U ^{N}** is the natural rate of unemployment, which is also the central bank’s employment regime.

**Ụ ^{F} **denotes frictional unemployment.

**Ṿ** represents the circulation velocity of money.

**Ѵ **denotes a notional stock-market price index.

**W** represents the hourly wage.

**W ^{m} **(the

*market wage*) is labor’s expected discounted opportunity costs:

*W*

^{m}=

*W*

^{a}.

**W ^{n}** (the

*efficiency wage*) is the hourly compensation that minimizes unit labor costs.

**W ^{ń} **(the

*reference wage*) is the hourly compensation that satisfies the workers’ axiomatic preference for fair treatment by management:

*W*

_{j}

^{ń}=sup

**Ҝ**≥

_{j}*W*

^{a}

_{j}=

*W*

^{m}.

**W ^{Ʀ} **is the reservation wage

**.**

**Ш** denotes (homogeneous) material input.

**Ϣ** denotes household nominal wealth.

**X **is total inflation-adjusted output.

**X ^{P} **is maximum real output implied by the capital stock (

*Ҡ*) and available labor (

*H*).

**Y** denotes aggregate nominal income.

**Ұ **denotes full-information aggregate income: *Ұ*(t)=*E*_{t}*Y*(t), where *E*_{t} is an expectations operator conditional on information, cost-effectively available at time *t*, that is relevant to the discounted future path of actual income (*Y*). Central-bank behavior, notably the credibility of its real-side and nominal objectives, must inform such expectations.

**Ź** equals Έ(t)/H(t), representing employee on-the-job behavior.

**Ź ^{ɱ}** denotes worker OJB consistent with (technologically given) cost-effective workplace supervision.