This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Spatial Heterogeneity and the Wage Curve revisited

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Simonetta Longhi () (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)
Peter Nijkamp () (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)
Jacques Poot () (University of Waikato, Hamilton, New Zealand)

Additional information is available for the following registered author(s):

Abstract

Most ‘wage curve’ studies treat local labour markets as independent ‘islands’ in the national economy. However, when a local labour market is in close proximity of other labour markets, a local shock that increases unemployment may not lead to lower pay rates if employers fear outward migration of their workers. Hence, the unemployment elasticity of pay will be greater, the more isolated the local labour market is. Wages are also expected to be higher in regions that interact strongly with other regions. These hypotheses are confirmed by means of an estimation of wage curves with data for 327 regions of western Germany over the period 1990-97.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.tinbergen.nl/discussionpapers/04054.pdf
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 04-054/3.

Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Length:
Date of creation: 12 May 2004
Date of revision:
Handle: RePEc:dgr:uvatin:20040054

Contact details of provider:
Web page: http://www.tinbergen.nl/

For technical questions regarding this item, or to correct its listing, contact: (Walther Schoonenberg).

Related research
Keywords: Unemployment wage formation spatial analysis local monopsony Germany

Other versions of this item:

Find related papers by JEL classification:
J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
R23 - Urban, Rural, and Regional Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

This paper has been announced in the following NEP Reports:

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.:
  1. Thiess Buettner, 1999. "The effect of unemployment, aggregate wages, and spatial contiguity on local wages: An investigation with German district level data," Papers in Regional Science, Springer, vol. 78(1), pages 47-67. [Downloadable!] (restricted)
  2. Bratsberg, Bernt & Turunen, Jarkko, 1996. "Wage curve evidence from panel data," Economics Letters, Elsevier, vol. 51(3), pages 345-353, June. [Downloadable!] (restricted)
  3. Montuenga, Victor & Garcia, Inmaculada & Fernandez, Melchor, 2003. "Wage flexibility: evidence from five EU countries based on the wage curve," Economics Letters, Elsevier, vol. 78(2), pages 169-174, February. [Downloadable!] (restricted)
  4. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-44, June. [Downloadable!] (restricted)
  5. Keane, Michael P & Runkle, David E, 1992. "On the Estimation of Panel-Data Models with Serial Correlation When Instruments Are Not Strictly Exogenous," Journal of Business & Economic Statistics, American Statistical Association, vol. 10(1), pages 1-9, January.
  6. Lutz Bellmann & Uwe Blien, 2001. "Wage curve analyses of establishment data from western Germany," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 54(4), pages 851-863, July.
  7. Rama, Martin & Scott, Kinnon, 1999. "Labor Earnings in One-Company Towns: Theory and Evidence from Kazakhstan," World Bank Economic Review, Oxford University Press, vol. 13(1), pages 185-209, January.
  8. Freeman, Richard B., 1998. "War of the models: Which labour market institutions for the 21st century?1," Labour Economics, Elsevier, vol. 5(1), pages 1-24, March. [Downloadable!] (restricted)
  9. Molho, Ian, 1992. " Local Pay Determination," Journal of Economic Surveys, Blackwell Publishing, vol. 6(2), pages 155-94.
  10. David G. Blanchflower & Andrew J. Oswald, 1990. "The Wage Curve," NBER Working Papers 3181, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  11. Salop, Steven C, 1979. "A Model of the Natural Rate of Unemployment," American Economic Review, American Economic Association, vol. 69(1), pages 117-25, March. [Downloadable!] (restricted)
  12. Anselin, Luc & Bera, Anil K. & Florax, Raymond & Yoon, Mann J., 1996. "Simple diagnostic tests for spatial dependence," Regional Science and Urban Economics, Elsevier, vol. 26(1), pages 77-104, February. [Downloadable!] (restricted)
  13. Simon Burgess & Stefan Profit, 2001. "Externalities in the Matching of Workers and Firms in Britain," CEP Discussion Papers 0490, Centre for Economic Performance, LSE. [Downloadable!]
    Other versions:
  14. Badi H. Baltagi & Seuck Heun Song & Won Koh, 2002. "Testing Panel Data Regression Models with Spatial Error Correlation," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 B6-4, International Conferences on Panel Data. [Downloadable!]
    Other versions:
  15. Ringuede, Sebastien, 1998. "An efficiency wage model for small firms: firm size and wages," Economics Letters, Elsevier, vol. 59(2), pages 263-268, May. [Downloadable!] (restricted)
  16. Winter-Ebmer, Rudolf, 1996. "Wage curve, unemployment duration and compensating differentials," Labour Economics, Elsevier, vol. 3(4), pages 425-434, December. [Downloadable!] (restricted)
  17. Büttner, Thiess & Fitzenberger, Bernd, 1998. "Central wage bargaining and local wage flexibility : evidence from the entire wage distribution," ZEW Discussion Papers 98-39, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  18. Ipek Ilkkaracan & Raziye Selim, 2003. "The role of unemployment in wage determination: further evidence on the wage curve from Turkey," Applied Economics, Taylor and Francis Journals, vol. 35(14), pages 1589-1598, September. [Downloadable!] (restricted)
  19. repec:fth:prinin:343 is not listed on IDEAS
  20. Baltagi, Badi H. & Blien, Uwe, 1998. "The German wage curve: evidence from the IAB employment sample," Economics Letters, Elsevier, vol. 61(2), pages 135-142, November. [Downloadable!] (restricted)
  21. Kennedy, Steven & Borland, Jeff, 2000. "A Wage Curve for Australia?," Oxford Economic Papers, Oxford University Press, vol. 52(4), pages 774-803, October.
    Other versions:
  22. Bhaskar, V & To, Ted, 1999. "Minimum Wages for Ronald McDonald Monopsonies: A Theory of Monopsonistic Competition," Economic Journal, Royal Economic Society, vol. 109(455), pages 190-203, April. [Downloadable!] (restricted)
    Other versions:
  23. Heather Boushey, 2002. "Reworking the Wage Curve: exploring the consistency of the model across time, space and demographic group," Review of Political Economy, Taylor and Francis Journals, vol. 14(3), pages 293-311, July. [Downloadable!] (restricted)
  24. Morrison, Philip S. & Papps, Kerry L. & Poot, Jacques, 2006. "Wages, employment, labour turnover and the accessibility of local labour markets," Labour Economics, Elsevier, vol. 13(5), pages 639-663, October. [Downloadable!] (restricted)
  25. Sato, Yasuhiro, 2000. "Search theory and the wage curve," Economics Letters, Elsevier, vol. 66(1), pages 93-98, January. [Downloadable!] (restricted)
  26. Fujita, Masahisa & Thisse, Jacques-François, 1996. "Economics of Agglomeration," CEPR Discussion Papers 1344, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  27. Blackaby, David H & Hunt, Lester C, 1992. "The "Wage Curve" and Long-term Unemployment: A Cautionary Note," The Manchester School of Economic & Social Studies, Blackwell Publishing, vol. 60(4), pages 419-28, December.
  28. William M. Boal & Michael R. Ransom, 1997. "Monopsony in the Labor Market," Journal of Economic Literature, American Economic Association, vol. 35(1), pages 86-112, March. [Downloadable!] (restricted)
  29. Janssens, Stefan & Konings, Jozef, 1998. "One more wage curve: the case of Belgium," Economics Letters, Elsevier, vol. 60(2), pages 223-227, August. [Downloadable!] (restricted)
  30. Melvyn G. Coles, 2001. "Equilibrium Wage Dispersion, Firm Size and Growth," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 4(1), pages 159-187, January. [Downloadable!] (restricted)
  31. Baily, Martin Neil, 1974. "Wages and Employment under Uncertain Demand," Review of Economic Studies, Blackwell Publishing, vol. 41(1), pages 37-50, January. [Downloadable!] (restricted)
  32. David Card, 1995. "The Wage Curve: A Review," Journal of Economic Literature, American Economic Association, vol. 33(2), pages 285-299, June. [Downloadable!] (restricted)
  33. Wheaton, William C. & Lewis, Mark J., 2002. "Urban Wages and Labor Market Agglomeration," Journal of Urban Economics, Elsevier, vol. 51(3), pages 542-562, May. [Downloadable!] (restricted)
  34. Azariadis, Costas, 1975. "Implicit Contracts and Underemployment Equilibria," Journal of Political Economy, University of Chicago Press, vol. 83(6), pages 1183-1202, December. [Downloadable!] (restricted)
  35. Johansen, Kare & Ringdal, Kristen & Thoring, Thor Atle, 2001. "Firm Profitability, Regional Unemployment and Human Capital in Wage Determination," Applied Economics, Taylor and Francis Journals, vol. 33(1), pages 113-21, January. [Downloadable!] (restricted)
  36. Campbell, Carl & Orszag, J. Michael, 1998. "A model of the wage curve," Economics Letters, Elsevier, vol. 59(1), pages 119-125, April. [Downloadable!] (restricted)
  37. Peter Nijkamp & Jacques Poot, 2005. "The Last Word on the Wage Curve?," Journal of Economic Surveys, Blackwell Publishing, vol. 19(3), pages 421-450, 07. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, 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.)

  1. Anna Iara & Iulia Traistaru, 2004. "How Flexible are Wages in EU Accession Countries?," ERSA conference papers ersa04p191, European Regional Science Association. [Downloadable!]
    Other versions:
  2. Marisa Bucheli & Cecilia González, 2007. "An estimation of the wage curve for Uruguay," Documentos de Trabajo (working papers) 1107, Department of Economics - dECON. [Downloadable!]
  3. repec:ese:iserwp: is not listed on IDEAS
  4. Jacques Poot & Bill Cochrane & Sandra Baxendine, 2005. "Description and Spatial Analysis of Employment Change in New Zealand Regions 1986-2001," Population Studies Centre Discussion Papers dp-57, University of Waikato, Population Studies Centre. [Downloadable!]
Statistics
Access and download statistics

Did you know? All bibliographic data on IDEAS has been put in the public domain by the publishers.

This page was last updated on 2008-7-23.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.