Job Guarantee Wage Calibration: The Employment-Maximising Wage

The Libertarian Job Guarantee sets its wage at the level consistent with the highest level of private employment and discovers that level empirically through the NAIBER signal rather than asserting it administratively (Charles 2026p). The parent paper states the principle and defers the method. This paper supplies it. We make three arguments and derive twelve propositions and two corollaries. First, the employment-maximising wage is a positive quantity rather than a policy preference: under imperfect labour market competition it is the wage at which the aggregate monopsony markdown vanishes, which is why the Hayekian upper bound and the CCS-interruption lower bound (Charles 2026c) are not in tension but bracket a single point. A national wage set at that point maximises national private employment while maximising it in no locality, which bounds what finer granularity can buy and supplies the criterion the parent paper's granularity question was awaiting. Because the buffer stock shrinks as the wage approaches the maximum from below, the fiscal cost of the guarantee is non-monotonic in its own wage wherever the buffer's wage elasticity exceeds unity — the cheapest guarantee is not the lowest-wage guarantee. Second, calibration is an inference problem conducted against three obstructions — simultaneity, employer manipulability, and propagation lag — and not a measurement problem. The Indian evidence is decisive on the third: the introduction of an employment guarantee produces no detectable jump in market wages, and the effect is identified only in cumulative exposure (Berg et al. 2018). A ratchet that increments faster than the signal settles is an open-loop controller, and we state the Ratchet–Lag Condition that governs the interval. We give the calibration panel its formal structure: a panel is adequate only if no single low-cost employer strategy moves every member concordantly; the decision rule is asymmetric, defaulting to proceed, because the cheap manipulation is a false stop signal; and the concentration weighting the parent paper proposed does double duty, since employer concentration measures the cheapness of gaming and the remaining headroom simultaneously — both are consequences of the same markdown. From the same identification we obtain a restrictive rule for shock response — the floor level is not modulated unless the shock lands on the subsistence basket, a rent-removing valve is applied simultaneously to the same constrained resource, and a reversion trigger is published with the modulation — and a diagnosis for the post-recession restart, where a stalled buffer ratio means either that the calibration has arrived or that the demand-floor conjecture has been refuted, and only a panel can tell them apart. Third, and at greatest length, we develop the peripheral case. The affordability argument — every economy already pays for NAIRU, and the guarantee costs less — holds in aggregate and requires qualification in composition: the NAIRU baseline is paid overwhelmingly in domestic real resources while the guarantee's wage is paid partly in foreign exchange through the import content of bottom-decile consumption. The binding peripheral constraint is therefore compositional, and we state the Import-Content Ceiling that follows and the Domestication Precedence Rule it implies, which reorders the rollout to put subsistence-basket capacity ahead of nominal increments and connects the calibration directly to the Aquaponics JG (Charles 2026p3). We identify the guarantee as the only wage floor that binds in an informal labour market, because it operates on the worker's outside option rather than on employer compliance — the Indian programme raised informal agricultural wages without enforcement action against any employer — and we show that where implementation is poor the effective floor is the announced wage discounted by the probability and delay of payment, so that the first increments of a peripheral ratchet should be paid in implementation quality rather than in the nominal rate. We state the Anchor Condition: a wage financed by a donor appropriation is set by that appropriation and not by the labour market, and such a programme is a transfer with a work requirement rather than a buffer stock. Finally we survey market infrastructure in developing economies to answer the question the calibration cannot avoid — when is money not helpful? — and specify the Monetisation Gate, a published set of conditions on payment reach, cash-out access, and demonstrated local supply response that a locality must satisfy before its ratchet begins. Where the gate fails, the guarantee still runs and only the wage's monetary form is deferred; the in-kind or hybrid modality that follows is an imposition on the worker's consumption choice, and we treat it as one, with a necessity test and a published exit condition. The pace of the ratchet is thereby made a function of monetisation depth: the harder a locality is to monetise, the slower its wage discovery, for the stated reason that its signal settles more slowly. We assume no rapid rollout anywhere and budget explicitly for translation, training, and failure.