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Wage Gap and Technology


  • Madsen, Jakob B


In this paper, the real wage gap is estimated under the Cobb-Douglas, the constant elasticity of substitution, and the translog technology assumptions for twenty-two OECD countries over the period 1960 to 1988. Employing pooled time-series and cross-section data, the extent to which the real wage gap path, under the different technology assumptions, has contributed to the unemployment path is estimated. The results indicate that the real wage gap is sensitive to technology assumption and at best it has marginally contributed to changes in unemployment across countries and over time. Copyright 1994 by WWZ and Helbing & Lichtenhahn Verlag AG

Suggested Citation

  • Madsen, Jakob B, 1994. "Wage Gap and Technology," Kyklos, Wiley Blackwell, vol. 47(1), pages 95-108.
  • Handle: RePEc:bla:kyklos:v:47:y:1994:i:1:p:95-108

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    References listed on IDEAS

    1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
    2. Williamson, Oliver E, 1991. "Economic Institutions: Spontaneous and Intentional Governance," Journal of Law, Economics, and Organization, Oxford University Press, vol. 7(0), pages 159-187, Special I.
    3. McAfee, R. Preston & McMillan, John, 1989. "Government procurement and international trade," Journal of International Economics, Elsevier, vol. 26(3-4), pages 291-308, May.
    4. Besley, Timothy & Case, Anne, 1995. "Incumbent Behavior: Vote-Seeking, Tax-Setting, and Yardstick Competition," American Economic Review, American Economic Association, vol. 85(1), pages 25-45, March.
    5. Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, January.
    6. Salmon, Pierre, 1987. "Decentralisation as an Incentive Scheme," Oxford Review of Economic Policy, Oxford University Press, vol. 3(2), pages 24-43, Summer.
    7. Miyagiwa, Kaz, 1991. "Oligopoly and Discriminatory Government Procurement Policy," American Economic Review, American Economic Association, vol. 81(5), pages 1320-1328, December.
    8. Klein, Benjamin & Murphy, Kevin M, 1988. "Vertical Restraints as Contract Enforcement Mechanisms," Journal of Law and Economics, University of Chicago Press, vol. 31(2), pages 265-297, October.
    9. Finsinger, Jorg, 1988. "Non-competitive and protectionist government purchasing behavior," European Economic Review, Elsevier, vol. 32(1), pages 69-80, January.
    10. Galeotti, Gianluigi & Breton, Albert, 1986. "An Economic Theory of Political Parties," Kyklos, Wiley Blackwell, vol. 39(1), pages 47-65.
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    Cited by:

    1. Madsen, Jakob B., 1995. "Inflation and aggregate demand shocks," Journal of Policy Modeling, Elsevier, vol. 17(6), pages 659-666, December.
    2. Junankar, P.N. & Madsen, J.B., 1996. "Unemployment in the OECD: models and mysteries," Discussion Paper Series In Economics And Econometrics 9648, Economics Division, School of Social Sciences, University of Southampton.

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