Abstract
Omega is an overpopulated and socially homogenous capitalist society. As shown in chapter 5 (volume 1), the marginal productivity of the total labor supply is near zero. Thus, the Walrasian real wage rate would be near zero, which is socially unviable. The labor market cannot operate as Walrasian and thus it will be non-Walrasian. The economic structure of the omega model includes a capitalist sector together with a subsistence sector. Part of the labor force is employed in the capitalist sector and receive wages; the rest, the excess labor supply, is unemployed or self-employed in the subsistence sector.
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