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The Determination of Contract Wages in West Germany

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  • Carruth, Alan
  • Schnabel, Claus

Abstract

The determination of contract wages in West Germany is studied within a bargaining framework, taking into account some institutional features of the bargaining system as well as the influence of economic forecasts and wage concepts. Cointegration regressions suggest that, in the long run, nominal contract wages are linked to prices, productivity (each with a unit elasticity), and unemployment. In addition to these factors, expectational errors concerning the inflation rate during the contract period and changes in the tax wedge affect (real) wage growth in the short run, but these effects seem to be temporary rather than permanent. Copyright 1993 by The editors of the Scandinavian Journal of Economics.

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Bibliographic Info

Article provided by Wiley Blackwell in its journal Scandinavian Journal of Economics.

Volume (Year): 95 (1993)
Issue (Month): 3 ()
Pages: 297-310

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Handle: RePEc:bla:scandj:v:95:y:1993:i:3:p:297-310

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Web page: http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-9442

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Cited by:
  1. VILHUBERT, Lars, 1999. "Wage Flexibility and Contract Structure in Germany," Cahiers de recherche 9905, Universite de Montreal, Departement de sciences economiques.
  2. Pfeiffer, Friedhelm, 1999. "Lohnflexibilisierung aus volkswirtschaftlicher Sicht," ZEW Dokumentationen 99-01, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. John T. Addison & Claus Schnabel & Joachim Wagner, 2006. "The (Parlous) State of German Unions," Working Paper Series in Economics 23, University of Lüneburg, Institute of Economics.
  4. Kees Folmer, 2009. "Why do macro wage elasticities diverge?," CPB Memorandum 224, CPB Netherlands Bureau for Economic Policy Analysis.
  5. Vasilescu, Denisa Maria & Aparaschivei, Larisa & Roman, Mihai Daniel, 2012. "Employment in Romania: evidence from a panel data analysis," MPRA Paper 38388, University Library of Munich, Germany.
  6. Welsch, Heinz, 2001. "The determinants of production-related carbon emissions in West Germany, 1985-1990: assessing the role of technology and trade," Structural Change and Economic Dynamics, Elsevier, vol. 12(4), pages 425-455, December.
  7. Uwe Jirjahn, 2013. "Der Beitrag der Arbeitsmarktökonomik zur Erforschung von Gewerkschaften und Tarifvertragsbeziehungen in Deutschland," Research Papers in Economics 2013-03, University of Trier, Department of Economics.
  8. Kees Folmer, 2009. "Why do macro wage elasticities diverge? A meta analysis," CPB Discussion Paper 122, CPB Netherlands Bureau for Economic Policy Analysis.

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