Advanced Search
MyIDEAS: Login

Wage-Productivity Gap in Turkish Manufacturing Sector

Contents:

Author Info

  • Ceyhun ELGİN

    (Boğaziçi Üniversitesi)

  • Tolga Umut KUZUBAŞ

    (Boğaziçi Üniversitesi)

Abstract

Perfectly competitive labor markets without distortionary taxes combined with a profit maximizing behavior of firms should imply that real wages should equal marginal product of labor (MPL). In this paper, we study the Turkish manufacturing industry and find that there exist a significant widening gap between real wages and marginal product of labor over the period 1950-2009. Using different time-series econometric techniques we show that this gap is foremost correlated with the unemployment rate over the period of study. To provide an economic mechanism for this relationship we build a search model of employment with endogenous bargaining. Our model implies that this observation is consistent with declining bargaining power of the workers, which is also supported by the data.

Download Info

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

Bibliographic Info

Article provided by Bilgesel Yayincilik in its journal İktisat İşletme ve Finans.

Volume (Year): 27 (2012)
Issue (Month): 316 ()
Pages: 09-31

as in new window
Handle: RePEc:iif:iifjrn:v:27:y:2012:i:316:p:09-31

Contact details of provider:
Email:
Web page: http://iif.com.tr

Related research

Keywords: Labor market; Turkey; Search models; Wage-productivity gap;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
  2. Emine Boz & Ceyhun Bora Durdu & Nan Li, 2012. "Emerging Market Business Cycles: The Role of Labor Market Frictions," IMF Working Papers 12/237, International Monetary Fund.
  3. Ipek Ilkkaracan & Raziye Selim, 2003. "The role of unemployment in wage determination: further evidence on the wage curve from Turkey," Applied Economics, Taylor & Francis Journals, vol. 35(14), pages 1589-1598.
  4. Gregory, A.W. & Hansen, B.E., 1992. "Residual-Based Tests for Cointegration in Models with Regime Shifts," RCER Working Papers 335, University of Rochester - Center for Economic Research (RCER).
  5. McCall, John J, 1970. "Economics of Information and Job Search," The Quarterly Journal of Economics, MIT Press, vol. 84(1), pages 113-26, February.
  6. Pierre Cahuc & Fabien Postel-Vinay & Jean-Marc Robin, 2006. "Wage Bargaining with On-the-Job Search: Theory and Evidence," Econometrica, Econometric Society, vol. 74(2), pages 323-364, 03.
  7. Elgin, Ceyhun & Kuzubas, Tolga Umut, 2013. "Wage-productivity gap in OECD economies," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 7(21), pages 1-21.
  8. Mortensen, Dale T & Pissarides, Christopher A, 1994. "Job Creation and Job Destruction in the Theory of Unemployment," Review of Economic Studies, Wiley Blackwell, vol. 61(3), pages 397-415, July.
  9. Hakan Berument & Nukhet Dogan & Aysit Tansel, 2008. "Macroeconomic Policy and Unemployment by Economic Activity: Evidence from Turkey," ERC Working Papers 0803, ERC - Economic Research Center, Middle East Technical University, revised Apr 2008.
  10. Robert E. Hall, 2005. "Employment Fluctuations with Equilibrium Wage Stickiness," American Economic Review, American Economic Association, vol. 95(1), pages 50-65, March.
  11. Persky, Joseph & Tsang, Herbert, 1974. "Pigouvian Exploitation of Labor," The Review of Economics and Statistics, MIT Press, vol. 56(1), pages 52-57, February.
  12. Agenor, Pierre-Richard & Jensen, Henning Tarp & Verghis, Mathew & Yeldan, Erinc, 2006. "Disinflation, fiscal sustainability, and labor market adjustment in Turkey," Policy Research Working Paper Series 3804, The World Bank.
  13. Madeline Zavodny, 1999. "Unions and the wage-productivity gap," Economic Review, Federal Reserve Bank of Atlanta, issue Q2, pages 44-53.
  14. Giovanni Sulis, 2008. "Wage Dispersion and Equilibrium Search Models: Some Evidence from Italy," LABOUR, CEIS, vol. 22(4), pages 593-627, December.
  15. Tasci, H. Mehmet & Tansel, Aysit, 2005. "Unemployment and Transitions in the Turkish Labor Market: Evidence from Individual Level Data," IZA Discussion Papers 1663, Institute for the Study of Labor (IZA).
  16. Robert Shimer, 2005. "The Cyclical Behavior of Equilibrium Unemployment and Vacancies," American Economic Review, American Economic Association, vol. 95(1), pages 25-49, March.
  17. Deniz Cicek & Ceyhun Elgin, 2010. "Not-Quite-Great Depressions of Turkey: A Quantitative Analysis of Economic Growth over 1968 - 2004," Working Papers 2010/07, Bogazici University, Department of Economics.
  18. Hakan Berument & Nukhet Dogan & Aysit Tansel, 2004. "Economic Performance and Unemployment: Evidence from an Emerging Economy - Turkey," Working Papers 0409, Economic Research Forum, revised Apr 2004.
  19. Pekka Ilmakunnas & Mika Maliranta, 2002. "Labour characteristics and wage-productivity gaps," New Zealand Economic Papers, Taylor & Francis Journals, vol. 36(1), pages 73-74.
  20. Gregory, Allan W & Hansen, Bruce E, 1996. "Tests for Cointegration in Models with Regime and Trend Shifts," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 58(3), pages 555-60, August.
  21. Altug, Sumru & Filiztekin, Alpay & Pamuk, Şevket, 2008. "Sources of long-term economic growth for Turkey, 1880–2005," European Review of Economic History, Cambridge University Press, vol. 12(03), pages 393-430, December.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Elgin, Ceyhun & Kuzubas, Tolga Umut, 2013. "Wage-productivity gap in OECD economies," Economics Discussion Papers 2013-18, Kiel Institute for the World Economy.
  2. Elgin, Ceyhun & Yucel, Emekcan, 2013. "Determinants of the weight for leisure in preferences," Economics Discussion Papers 2013-57, Kiel Institute for the World Economy.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iif:iifjrn:v:27:y:2012:i:316:p:09-31. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ali Bilge).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.