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Wage rigidity in Italy

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Author Info
Orietta DESSY ()

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Abstract

In this study we analyse wage rigidity at the individual level in Italy, presenting evidence from the 1989-1995 Survey of the Bank of Italy. A deep statistical analysis is carried out, replicatingprevious approaches by McLaughlin, Card and Hyslop and Kahn over similar US data. We alsopropose new, simple tests for wage rigidity. The different approaches adopted seem to go in thesame the direction of showing a relevant, persistent degree of nominal wage rigidity in Italy. Theextent of wage rigidity is significant not only for employees staying in the same firm, but also formovers. At the same time, wages are not completely downwardly rigid: a certain percentage ofwage cuts is reported by individuals

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Paper provided by Department of Economics University of Milan Italy in its series Departemental Working Papers with number 2004-18.

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Date of creation: 01 Jan 2004
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Handle: RePEc:mil:wpdepa:2004-18

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  1. Steinar Holden, 2001. "Does Price Stability Exacerbate Labour Market Rigidities in the EMU?," Empirica, Springer, vol. 28(4), pages 403-418, December. [Downloadable!] (restricted)
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  2. Holden,S., 2001. "Monetary policy and nominal rigidities under low inflation," Memorandum 16/2001, Oslo University, Department of Economics. [Downloadable!]
    Other versions:
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