Wages in a Factor Proportions Model with Energy Input
AbstractThis paper examines US wage adjustment in a structural vector autoregression of the factor proportions model of production and trade with energy, capital, and labor inputs. Data cover the years 1949 to 2006. The wage adjusts to changes in inputs levels and output prices over 6 to 8 years. Energy has a more robust wage impact than capital. The wage reacts weakly if at all to the falling price of manufactures and rising price of services over the sample period. Estimates relate directly to factor proportions theory, suggesting robust substitution with labor in the middle of the factor intensity ranking.
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Bibliographic InfoPaper provided by Department of Economics, Auburn University in its series Auburn Economics Working Paper Series with number auwp2012-05.
Date of creation: Jul 2012
Date of revision:
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More information through EDIRC
Wages; Energy; Factor Proportions Model; Vector Autoregression;
Other versions of this item:
- Kim, Hyeongwoo & Thompson, Henry, 2014. "Wages in a factor proportions model with energy input," Economic Modelling, Elsevier, vol. 36(C), pages 495-501.
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-08-23 (All new papers)
- NEP-ENE-2012-08-23 (Energy Economics)
- NEP-LAB-2012-08-23 (Labour Economics)
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