New Evidence on the Dynamic Wage Curve for Western Germany: 1980-2004
AbstractBlanchflower and Oswald (1994) reported that they have found an 'empirical law of economics'--the Wage Curve. Our paper reconsiders the western German Wage Curve using disaggregated regional data and is based on almost one million employees drawn from the Federal Employment Services of Germany over the eriod 1980-2004. We find that the wage equation is highly autoregressive but far from unit root. The unemployment elasticity is significant but relatively small: only between -0.02 and -0.04. We also check the sensitivity of this elasticity for different population groups (young versus old, men versus women, less educated versus highly educated, German native versus foreigner), confirming that it is stronger the weaker the bargaining power of the particular group.
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Bibliographic InfoPaper provided by Center for Policy Research, Maxwell School, Syracuse University in its series Center for Policy Research Working Papers with number 103.
Length: 16 pages
Date of creation: Mar 2008
Date of revision:
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Wage curve; regional labor markets; Phillips curve; panel data;
Other versions of this item:
- Baltagi, Badi H. & Blien, Uwe & Wolf, Katja, 2009. "New evidence on the dynamic wage curve for Western Germany: 1980-2004," Labour Economics, Elsevier, vol. 16(1), pages 47-51, January.
- Baltagi, Badi H. & Blien, Uwe & Wolf, Katja, 2008. "New Evidence on the Dynamic Wage Curve for Western Germany: 1980–2004," IZA Discussion Papers 3433, Institute for the Study of Labor (IZA).
- J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
- R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
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