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Housing, Wages and UK Labour Markets

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Author Info
Bover, Olympia
Muellbauer, John
Murphy, Anthony

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Abstract

There is a considerable literature on the effects of imperfections in U.K. rented housing markets in restricting labor mobility. This paper examines the interaction of labor and housing markets, including the owner-occupied sector, more generally. Implications are drawn for the behavior of aggregate wages in the United Kingdom and for the relationship between aggregate unemployment and unfilled vacancies, which in part reflects mismatch between jobs and people. The authors find that lagged regional house prices also have a significant effect on wages. Their models incorporate cross-section evidence on the effect of tenure structure on mobility. They find that changes in unemployment and in sectoral mismatch are more important for wage pressure than are levels. This is consistent with arguments about the roles of insiders and outsiders in wage determination. Copyright 1989 by Blackwell Publishing Ltd

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Publisher Info
Article provided by Department of Economics, University of Oxford in its journal Oxford Bulletin of Economics & Statistics.

Volume (Year): 51 (1989)
Issue (Month): 2 (March)
Pages: 97-136
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Handle: RePEc:bla:obuest:v:51:y:1989:i:2:p:97-136

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0305-9049

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