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Workers' Flows and Real Wage Cyclicality

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  • Anabela Carneiro

    ()
    (CETE, Faculdade de Economia, Universidade do Porto)

  • Pedro Portugal

    ()
    (Banco de Portugal and Universidade Nova de Lisboa)

Abstract

This study investigates real wage cyclicality in Portugal for the years of 1986-98, adressing the heterogeneity in wages responses to aggregate labor market conditions for workers' hirings and separations. The results exhibit a moderate procyclical behavior of real wages for continuously employed workers, in particular, for job stayers. For workers' accessions a strongly procyclical behavior in wages was observed, which is consistent with the idea that entry wages are much more procyclical than current wages. This empirical evidence suggests that even micro-data estimates of real wage cyclicality may conceal a strong procyclical wage behavior, when heterogeneity on wages responses to aggregate conditions between employed workers and hirings and separations is not taken into account.

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Bibliographic Info

Paper provided by Universidade do Porto, Faculdade de Economia do Porto in its series CEF.UP Working Papers with number 0402.

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Length: 49 pages
Date of creation: May 2004
Date of revision:
Handle: RePEc:por:cetedp:0402

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Keywords: Wage cyclicality; hirings; separations;

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References

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Citations

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Cited by:
  1. Pedro S. Martins, 2007. "Heterogeneity In Real Wage Cyclicality," Scottish Journal of Political Economy, Scottish Economic Society, vol. 54(5), pages 684-698, November.
  2. Ch. Pissarides., 2011. "The Unemployment Volatility Puzzle: Is Wage Stickiness the Answer?," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 1.
  3. Montornès, J. & Sauner-Leroy, J-B., 2010. "Wage-setting Behavior in France: Additional Evidence from an Ad-hoc Survey," Working papers 282, Banque de France.
  4. Christopher A. Pissarides, 2006. "Unemployment and Hours of Work: The North Atlantic Divide Revisited," CEP Discussion Papers dp0757, Centre for Economic Performance, LSE.

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