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Poorer workers. The determinants of wage formation in Europe

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Author Info

  • Francesco Bogliacino

Abstract

Using industry level data for eight European countries, we present empirical evidence of poor wage performance in the two decades straddling the millennium. There was a real wage decline in many sectors and we examine its inequality-enhancing effect. A theoretical framework is proposed and assessed in order to understand this evolution of wages, identifying their main determinants. We investigate the role played by different types of innovation, increasing international openness, demand, norms limiting competition and employment change. The results are consistent with our thesis that technology and globalization shape the bargaining power of workers; increasing wages are found in industries characterized by product innovation, while process innovation and greater international openness are associated to a reduction of real wages.

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File URL: http://www.tandfonline.com/doi/abs/10.1080/02692170902811751
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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal International Review of Applied Economics.

Volume (Year): 23 (2009)
Issue (Month): 3 ()
Pages: 327-343

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Handle: RePEc:taf:irapec:v:23:y:2009:i:3:p:327-343

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Related research

Keywords: efficiency wages; wage inequality; innovation; globalization;

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Cited by:
  1. Maurizio Franzini & Mario Pianta, 2011. "Explaining inequality in today’s capitalism," Working Papers 1108, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2011.

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