is such a small number, the marginal rate is virtually equal to r.
In general we find:
dq / dy = (dq / dY) . ( dY / dy) = dq / dY
Since dY / dy = 1. If parameters are indexed on national income, then dLog[q] = dLog[Y] and then dq / dY = q / Y so that
dq / dy = q / Y
which is close to zero since parameters q are generally much smaller than national income. We conclude that dq / dy = dq / dY is not quite zero, but practically zero, and this seems to corroborate the conventional reaction to the DMR.
Hence the conventional reaction to the DMR is that the DMR does not change the traditional analysis on marginal rates. Hence there is no hope for unemploment along these lines. With ongoing technological growth and competition of low wage countries, only the flexibility of labour markets will help to reduce unemployment, even if this means a reduction of net minimum wages. That, at least, is the conventional reaction.