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Does wage reflect labor productivity? A comparison between Brazil and the United States

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  • Alexandre Gori Maia
  • Arthur Sakamoto

Abstract

The study compares the relationship between wages and labor productivity for different categories of workers in Brazil and in the U.S. Analyses highlight to what extent the equilibrium between wages and productivity is related to the degree of economic development. Wages in the U.S. has shown to be more attached to labor productivity, while Brazil has experienced several economic cycles were average earnings grew initially much faster than labor productivity, suddenly falling down in the subsequent years. Analyses also stress how wage differentials, in fact, match productivity differentials for certain occupational groups, while for others they do not. JEL Classification: J21; J24; J31.

Suggested Citation

  • Alexandre Gori Maia & Arthur Sakamoto, 2018. "Does wage reflect labor productivity? A comparison between Brazil and the United States," Brazilian Journal of Political Economy, Center of Political Economy, vol. 38(4), pages 629-649..
    • Handle: RePEc:ekm:repojs:v:38:y:2018:i:4:p:629-649.:id:91
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    References listed on IDEAS

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    3. Van Biesebroeck, Johannes, 2011. "Wages Equal Productivity. Fact or Fiction? Evidence from Sub Saharan Africa," World Development, Elsevier, vol. 39(8), pages 1333-1346, August.
    4. Alexandre Gori Maia & Esther Menezes, 2014. "Economic growth, labor and productivity in Brazil and the United States: a comparative analysis," Brazilian Journal of Political Economy, Center of Political Economy, vol. 34(2), pages 212-229.
    5. Acemoglu, Daron & Autor, David, 2011. "Skills, Tasks and Technologies: Implications for Employment and Earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 12, pages 1043-1171, Elsevier.
    6. Feldstein, Martin, 2008. "Did wages reflect growth in productivity?," Journal of Policy Modeling, Elsevier, vol. 30(4), pages 591-594.
    7. Pekka Ilmakunnas & Mika Maliranta, 2005. "Technology, Labour Characteristics and Wage‐productivity Gaps," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 67(5), pages 623-645, October.
    8. James K. Galbraith, 2010. "Inequality and economic and political change: a comparative perspective," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 4(1), pages 13-27.
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    Cited by:

    1. Borche TRENOVSKI & Kristijan KOZHESKI & Biljana TASHEVSKA & Filip PEOVSKI, 2021. "THE MINIMUM WAGE Impact ON LABOUR PRODUCTIVITY: THE CASE OF SELECTED SEE COUNTRIES," Management Research and Practice, Research Centre in Public Administration and Public Services, Bucharest, Romania, vol. 13(3), pages 32-42, September.
    2. Jorge Ariel Franco-López, Julián Alberto Uribe-Gómez, Sebastián Agudelo-Vallejo, 2021. "Factores clave en la evaluación de la productividad: estudio de caso," Revista CEA, Instituto Tecnológico Metropolitano, vol. 7(15), pages 1-26, September.

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    More about this item

    Keywords

    Labor market; occupational structure; inequality; economic development;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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