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Labour Flows as Determinants of the Wage–Price Spiral: An Empirical Analysis for The Netherlands

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  • Lourens Broersma
  • Frank A. G. Den Butter

Abstract

This study presents an empirical analysis of the influence of labour market flows on wage and price formation. A system of wage, price and employment equations after Nickell (Oxford Bulletin of Economics and Statistics 49: 103–128, 1987) is estimated, including labour flows as indicators of labour market tightness in the wage equation. An impulse response analysis using this system shows how changes in the flow of layoffs (flow from employment to unemployment) may be the basis of short‐run Phillips curve effects in The Netherlands

Suggested Citation

  • Lourens Broersma & Frank A. G. Den Butter, 2001. "Labour Flows as Determinants of the Wage–Price Spiral: An Empirical Analysis for The Netherlands," LABOUR, CEIS, vol. 15(2), pages 279-294, June.
    • Handle: RePEc:bla:labour:v:15:y:2001:i:2:p:279-294
    DOI: 10.1111/1467-9914.00165
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    Cited by:

    1. Lourens Broersma & Frank A. G. den Butter & Udo Kock, 2006. "A cointegration model for search equilibrium wage formation," Journal of Applied Economics, Universidad del CEMA, vol. 9, pages 235-254, November.
    2. Frank A. G. Den Butter & Florian Eppink, 2003. "The influence of labour flows on wage drift: an empirical analysis for The Netherlands," Applied Economics Letters, Taylor & Francis Journals, vol. 10(3), pages 139-142.
    3. Fredrik Carlsen & Kåre Johansen & Knut RØed, 2006. "Wage Formation, Regional Migration and Local Labour Market Tightness," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 68(4), pages 423-444, August.
    4. International Monetary Fund, 2004. "A Cointegration Model for Search Equilibrium Wage Formation," IMF Working Papers 2004/092, International Monetary Fund.

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