Wages, Productivity And Human Capital In The European Union: Econometric Models And Comparison With The Usa 1985-2005
AbstractThe European Union lags behind the United States both in rates of employment and real wages. This study analyzes the relationship between wages, productivity and human capital in 5 European Union countries: France, Germany, Italy, Spain and the United Kingdom, in comparison with the USA. Firstly we analyze the role of productivity in the explanation of real wages, secondly we present a comparative study of the evolution of wages and productivity during the period 1985-2005, and thirdly we estimate an econometric model which relates real wages with productivity and productivity with human capital. As measures of human capital we have included the average total years of schooling, based on Barro and Lee estimations and lagged Research expenditure per inhabitant. The main conclusion is that the European Union should develop economic policies in order to increase the support to human capital, fostering education and RD expenditure in order to achieve higher levels of real wages and higher rates of employment and to converge towards to the levels of the United States.
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Bibliographic InfoArticle provided by Euro-American Association of Economic Development in its journal Applied Econometrics and International Development.
Volume (Year): 7 (2007)
Issue (Month): 1 ()
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Web page: http://www.usc.es/economet/eaa.htm
Find related papers by JEL classification:
- C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
- E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
- O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe
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- GUISAN, Maria-Carmen, 2011. "Industry, Foreign Trade and Employment in EU Countries; Comparison of France, Germany, Italy, Spain and the UK with the United States," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 11(2).
- Upender, M., 2009. "Elasticity Of Substitution Between Labour And Capital Across Twenty Six Major Industries In India During 2004-05," International Journal of Applied Econometrics and Quantitative Studies, Euro-American Association of Economic Development, vol. 9(1), pages 101-110.
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