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What is the relationship between interest rate and labor supply?
Wiki User
∙ 8y ago
There is not a direct link but high interest rates are associated with expectations of high rates of inflation. High inflation may be associated with high wage rises and so lower employment rates. Low employment rates would suggest excess labour supply. So, from one end of that chain to the other: high interest rates are associated with high labour supply.
Wiki User
∙ 7y ago
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