IDEAS home Printed from https://ideas.repec.org/p/iab/iabdpa/202017.html
   My bibliography  Save this paper

Is there a Wage Curve with Regional Real Wages?

Author

Listed:
  • Rokicki, Bartlomiej

    (Warsawa University)

  • Blien, Uwe

    (Institute for Employment Research (IAB), Nuremberg, Germany ; Univ. Bamberg)

  • Hewings, Geoffrey J. D.

    (University of Illinois)

  • Phan thi Hong, Van

    (Institute for Employment Research (IAB), Nuremberg, Germany)

Abstract

"Do wages react to regional unemployment, as proposed by the theory behind the regional wage curve, if regional price differences are taken into account? This paper applies regional price indexes to assess the wage curve, whereas in the literature only nominal wages are used for wage curve regressions. In order to test the impact of regional prices on the wage curve we apply a variety of methodological approaches. With individual data from the US Census and the Polish Labor Force Survey we find a wage curve. However, in both countries, the local unemployment elasticity and spatial spillovers decrease significantly once regional price deflators are applied." (Author's abstract, IAB-Doku) ((en))

Suggested Citation

  • Rokicki, Bartlomiej & Blien, Uwe & Hewings, Geoffrey J. D. & Phan thi Hong, Van, 2020. "Is there a Wage Curve with Regional Real Wages?," IAB-Discussion Paper 202017, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    • Handle: RePEc:iab:iabdpa:202017
    as

    Download full text from publisher

    File URL: https://doku.iab.de/discussionpapers/2020/dp1720.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Martin Beraja & Erik Hurst & Juan Ospina, 2019. "The Aggregate Implications of Regional Business Cycles," Econometrica, Econometric Society, vol. 87(6), pages 1789-1833, November.
    2. Badi H. Baltagi & Yusuf Soner Baskaya & Timur Hulagu, 2013. "How different are the wage curves for formal and informal workers? Evidence from Turkey," Papers in Regional Science, Wiley Blackwell, vol. 92(2), pages 271-283, June.
    3. David Card, 1995. "The Wage Curve: A Review," Working Papers 722, Princeton University, Department of Economics, Industrial Relations Section..
    4. Badi H. Baltagi & Bartlomiej Rokicki & Kênia Barreiro Souza, 2017. "The Brazilian wage curve: new evidence from the National Household Survey," Empirical Economics, Springer, vol. 53(1), pages 267-286, August.
    5. Uwe Blien & Hermann Gartner & Heiko Stüber & Katja Wolf, 2009. "Regional price levels and the agglomeration wage differential in western Germany," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(1), pages 71-88, March.
    6. Blien, Uwe & Messmann, Susanne & Trappmann, Mark, 2012. "Do reservation wages react to regional unemployment?," IAB-Discussion Paper 201222, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    7. repec:fth:prinin:343 is not listed on IDEAS
    8. Brandt, Loren & Holz, Carsten A, 2006. "Spatial Price Differences in China: Estimates and Implications," Economic Development and Cultural Change, University of Chicago Press, vol. 55(1), pages 43-86, October.
    9. Bell, Brian & Nickell, Stephen & Quintini, Glenda, 2002. "Wage equations, wage curves and all that," Labour Economics, Elsevier, vol. 9(3), pages 341-360, July.
    10. David G. Blanchflower & Andrew J. Oswald, 2005. "The Wage Curve Reloaded," NBER Working Papers 11338, National Bureau of Economic Research, Inc.
    11. Baltagi, Badi H. & Rokicki, Bartlomiej, 2014. "The spatial Polish wage curve with gender effects: Evidence from the Polish Labor Survey," Regional Science and Urban Economics, Elsevier, vol. 49(C), pages 36-47.
    12. David Card, 1995. "The Wage Curve: A Review," Journal of Economic Literature, American Economic Association, vol. 33(2), pages 285-299, June.
    13. Richard J. Cebula, 1980. "Determinants of Geographic Living-Cost Differentials in the United States: An Empirical Note," Land Economics, University of Wisconsin Press, vol. 56(4), pages 477-481.
    14. David G. Blanchflower & Andrew J. Oswald, 1995. "An Introduction to the Wage Curve," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 153-167, Summer.
    15. Brown, Sarah & Taylor, Karl, 2015. "The reservation wage curve: Evidence from the UK," Economics Letters, Elsevier, vol. 126(C), pages 22-24.
    16. Baltagi, Badi H. & Blien, Uwe & Wolf, Katja, 2012. "A dynamic spatial panel data approach to the German wage curve," Economic Modelling, Elsevier, vol. 29(1), pages 12-21.
    17. Jan Cadil & Petr Mazouch & Petr Musil & Jana Kramulova, 2014. "True regional purchasing power: evidence from the Czech Republic," Post-Communist Economies, Taylor & Francis Journals, vol. 26(2), pages 241-256, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jane Parker & Ozan Nadir Alakavuklar & Sam Huggard, 2021. "Social movement unionism through radical democracy: The case of the New Zealand Council of Trade Unions and climate change," Industrial Relations Journal, Wiley Blackwell, vol. 52(3), pages 270-285, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rokicki, Bartlomiej & Blien, Uwe & Hewings, Geoffrey J.D. & thi Hong Van, Phan, 2021. "Is there a wage curve with regional real wages? An analysis for the US and Poland," Economic Modelling, Elsevier, vol. 102(C).
    2. Ana Maria Bonomi Barufi & Eduardo A. Haddad, Peter Nijkamp, 2016. "New evidence on the wage curve: non-linearities, urban size, and spatial scale in Brazil," Working Papers, Department of Economics 2016_39, University of São Paulo (FEA-USP).
    3. Ana Barufi & Eduardo Haddad & Peter Nijkamp, 2016. "A comprehensive analysis of the wage curve in Brazil: Non-linearities, urban size, and the spatial dimension," ERSA conference papers ersa16p279, European Regional Science Association.
    4. Badi H. Baltagi & Yusuf Soner Başkaya, 2022. "Spatial wage curves for formal and informal workers in Turkey," Journal of Spatial Econometrics, Springer, vol. 3(1), pages 1-24, December.
    5. Reinhold Kosfeld & Christian Dreger, 2018. "Local and spatial cointegration in the wage curve – a spatial panel analysis for german regions," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 38(1), pages 53-75, February.
    6. Guilherme Cemin Paula & André M. Marques, 2022. "Brazilian Wage Curve: Further Evidence Based on Spatial Interactions in Times of Recession, 2012–2019," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 65(3), pages 689-708, September.
    7. Badi H. Baltagi & Bartlomiej Rokicki & Kênia Barreiro Souza, 2017. "The Brazilian wage curve: new evidence from the National Household Survey," Empirical Economics, Springer, vol. 53(1), pages 267-286, August.
    8. Joan Daouli & Michael Demoussis & Nicholas Giannakopoulos & Ioannis Laliotis, 2017. "The wage curve before and during the Greek economic crisis," Empirical Economics, Springer, vol. 52(1), pages 59-77, February.
    9. David Blanchflower & Alex Bryson & Jackson Spurling, 2024. "The wage curve after the Great Recession," Economica, London School of Economics and Political Science, vol. 91(362), pages 653-668, April.
    10. Bernard Fingleton & Simonetta Longhi, 2013. "The Effects Of Agglomeration On Wages: Evidence From The Micro-Level," Journal of Regional Science, Wiley Blackwell, vol. 53(3), pages 443-463, August.
    11. Baltagi, Badi H. & Rokicki, Bartlomiej, 2014. "The spatial Polish wage curve with gender effects: Evidence from the Polish Labor Survey," Regional Science and Urban Economics, Elsevier, vol. 49(C), pages 36-47.
    12. Baltagi, Badi H. & Blien, Uwe & Wolf, Katja, 2009. "New evidence on the dynamic wage curve for Western Germany: 1980-2004," Labour Economics, Elsevier, vol. 16(1), pages 47-51, January.
    13. Fingleton, Bernard & Palombi, Silvia, 2013. "Spatial panel data estimation, counterfactual predictions, and local economic resilience among British towns in the Victorian era," Regional Science and Urban Economics, Elsevier, vol. 43(4), pages 649-660.
    14. Kosfeld, Reinhold & Dreger, Christian, 2019. "Towards an East German wage curve - NUTS boundaries, labour market regions and unemployment spillovers," Regional Science and Urban Economics, Elsevier, vol. 76(C), pages 115-124.
    15. Brücker, Herbert & Hauptmann, Andreas & Jahn, Elke J. & Upward, Richard, 2014. "Migration and imperfect labor markets: Theory and cross-country evidence from Denmark, Germany and the UK," European Economic Review, Elsevier, vol. 66(C), pages 205-225.
    16. López Enciso, Enrique & Ramírez Giraldo, María Teresa (ed.), 2011. "Formación de precios y salarios en Colombia T.2," Books, Banco de la Republica de Colombia, volume 2, number 2011b-04, December.
    17. Marisa Carla Bucheli Anaya & Cecilia González Rodríguez-Villamil, 2012. "An estimation of the wage curve for Uruguay," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, June.
    18. Iara, Anna & Traistaru, Iulia, 2004. "How flexible are wages in EU accession countries?," Labour Economics, Elsevier, vol. 11(4), pages 431-450, August.
    19. Inmaculada Garcia-Mainar & Victor Montuenga-Gomez, 2003. "The Spanish Wage Curve: 1994-1996," Regional Studies, Taylor & Francis Journals, vol. 37(9), pages 929-945.
    20. Hynninen, Sanna-Mari, 2009. "Is there a wage curve for the highly educated?," ISER Working Paper Series 2009-17, Institute for Social and Economic Research.

    More about this item

    Keywords

    Polen ; USA ; Einkommenseffekte ; internationaler Vergleich ; Lohnkurve ; Preisniveau ; Reallohn ; regionale Disparität ; regionaler Arbeitsmarkt ; Arbeitslosenquote ; 2000-2015;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iab:iabdpa:202017. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: IAB, Geschäftsbereich Wissenschaftliche Fachinformation und Bibliothek (email available below). General contact details of provider: https://edirc.repec.org/data/iabbbde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.