IDEAS home Printed from https://ideas.repec.org/a/boh/actaub/v15y2012i1p91-101.html
   My bibliography  Save this article

Relationship between Unemployment and Wages at the Regional Level in the Czech Republic in the Period 2003-2010
[Vztah nezaměstnanosti a mezd na regionální úrovni v České republice v období 2003-2010 1]

Author

Listed:
  • Michal Šulc

    (The College of Polytechnics Jihlava)

  • Jana Borůvková

    (The College of Polytechnics Jihlava)

  • Roman Fiala

    (The College of Polytechnics Jihlava)

Abstract

The subject of the article is the relationship between unemployment and wages at the regional level in the Czech Republic in the period 2003-2010. The aim of the authors was to verify the construction possibility and validity of regional wage and Phillips curves both in the regions and at the national level. The analysis was done by means of linear regression models on the quarter data basis. The results for the period 2003-2008 show the wage curve validity both at the regional and national level. It is impossible to construct the wage curve in the period 2009-2010, for despite the big unemployment rise the wages remained steady during this time. This fact supports the idea of short time downwards rigidity of wages. In 2003-2008, contrary to 2009-2010, it is possible to say the Phillips curve was valid at the national level, for the unemployment rate decrease leaded to the increase of the wage growth rate. In particular regions with a few exceptions this relationship was not valid, which supports theoretical findings about the impossibility of the Phillips curve construction at lower than the national level.

Suggested Citation

  • Michal Šulc & Jana Borůvková & Roman Fiala, 2012. "Relationship between Unemployment and Wages at the Regional Level in the Czech Republic in the Period 2003-2010 [Vztah nezaměstnanosti a mezd na regionální úrovni v České republice v období 2003-20," Acta Universitatis Bohemiae Meridionalis, University of South Bohemia in Ceske Budejovice, Faculty of Economics, vol. 15(1), pages 91-101.
    • Handle: RePEc:boh:actaub:v:15:y:2012:i:1:p:91-101
    DOI: 10.32725/acta.2012.008
    as

    Download full text from publisher

    File URL: http://acta.ef.jcu.cz/doi/10.32725/acta.2012.008.html
    Download Restriction: free of charge
    File URL: http://acta.ef.jcu.cz/doi/10.32725/acta.2012.008.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.32725/acta.2012.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Michelle Gilmartin & Dimitris Korobilis, 2012. "On Regional Unemployment: An Empirical Examination of the Determinants of Geographical Differentials in the UK," Scottish Journal of Political Economy, Scottish Economic Society, vol. 59(2), pages 179-195, May.
    2. Peter Howitt, 2002. "Looking Inside the Labor Market: A Review Article," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 125-138, March.
    3. Elhorst, J. Paul, 2000. "The Mystery Of Regional Unemployment Differentialsa Survey Of Theoretical And Empirical Explanations," ERSA conference papers ersa00p60, European Regional Science Association.
    4. Thirlwall, A P, 1970. "Regional Phillips Curves," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 32(1), pages 19-32, February.
    5. Edmund S. Phelps, 1968. "Money-Wage Dynamics and Labor-Market Equilibrium," Journal of Political Economy, University of Chicago Press, vol. 76(4), pages 678-678.
    6. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard, 1986. "Fairness as a Constraint on Profit Seeking: Entitlements in the Market," American Economic Review, American Economic Association, vol. 76(4), pages 728-741, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jonas Agell & Helge Bennmarker, 2003. "Endogenous Wage Rigidity," CESifo Working Paper Series 1081, CESifo.
    2. Smith, Jennifer C., 2002. "Pay Cuts And Morale : A Test Of Downward Nominal Rigidity," The Warwick Economics Research Paper Series (TWERPS) 649, University of Warwick, Department of Economics.
    3. Sebastian Kube & Michel André Maréchal & Clemens Puppe, 2013. "Do Wage Cuts Damage Work Morale? Evidence From A Natural Field Experiment," Journal of the European Economic Association, European Economic Association, vol. 11(4), pages 853-870, August.
    4. Elsby, Michael W.L., 2009. "Evaluating the economic significance of downward nominal wage rigidity," Journal of Monetary Economics, Elsevier, vol. 56(2), pages 154-169, March.
    5. Fehr, Ernst & Tyran, Jean-Robert, 2007. "Money illusion and coordination failure," Games and Economic Behavior, Elsevier, vol. 58(2), pages 246-268, February.
    6. Fongoni, Marco & Dickson, Alex, 2015. "A Theory of Wage Setting Behavior," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-57, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. M. Ali Choudhary & Saima Mahmood & Sajawal Khan & Waqas Ahmed & Gylfi Zoega, 2013. "Sticky Wages in a Developing Country: Lessons from Structured Interviews in Pakistan," School of Economics Discussion Papers 0213, School of Economics, University of Surrey.
    8. Marco Fongoni & Alex Dickson, 2015. "A theory of wage setting behavior," Working Papers 1505, University of Strathclyde Business School, Department of Economics, revised Feb 2016.
    9. Schlicht, Ekkehart, . "Job Rents in a Stylized Labor Market," Chapters in Economics,, University of Munich, Department of Economics.
    10. Lilia Maliar & Liudmyla Hvozdyk & Serguei Maliar, 2006. "Downward Nominal Wage Rigidity: The Implications From A New-Keynesian Model," Working Papers. Serie AD 2006-04, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    11. Dennis A.V. Dittrich, 2004. "Wages, Length of Relationship and Bargaining Power: An experimental study in a world of complete contracts," Papers on Strategic Interaction 2004-18, Max Planck Institute of Economics, Strategic Interaction Group.
    12. Agell, Jonas & Bennmarker, Helge, 2002. "Wage policy and endogenous wage rigidity: a representative view from the inside," Working Paper Series 2002:12, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    13. repec:ebl:ecbull:v:4:y:2006:i:33:p:1-7 is not listed on IDEAS
    14. Alexander Klein & Karl Gunnar Persson & Paul Sharp, 2023. "Populism and the first wave of globalization: Evidence from the 1892 US presidential election," Rivista di storia economica, Società editrice il Mulino, issue 2, pages 163-202.
    15. Mengyuan Zhou, 2022. "Does the Source of Inheritance Matter in Bequest Attitudes? Evidence from Japan," Journal of Family and Economic Issues, Springer, vol. 43(4), pages 867-887, December.
    16. Willem Thorbecke, 2002. "A Dual Mandate for the Federal Reserve: The Pursuit of Price Stability and Full Employment," Eastern Economic Journal, Eastern Economic Association, vol. 28(2), pages 255-268, Spring.
    17. Simon G�chter & Arno Riedl, "undated". "Moral Property Rights in Bargaining," IEW - Working Papers 113, Institute for Empirical Research in Economics - University of Zurich.
    18. Christoph Engel & Michael Kurschilgen, 2011. "Fairness Ex Ante and Ex Post: Experimentally Testing Ex Post Judicial Intervention into Blockbuster Deals," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 8(4), pages 682-708, December.
    19. repec:spo:wpecon:info:hdl:2441/6120 is not listed on IDEAS
    20. John Haltiwanger & Scott Schuh, 1999. "Gross job flows between plants and industries," New England Economic Review, Federal Reserve Bank of Boston, issue Mar, pages 41-64.
    21. Robison, Lindon J. & Hanson, Steven D., 1995. "Social Capital and Economic Cooperation," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 27(1), pages 43-58, July.
    22. Kee, Hiau Looi & Hoon, Hian Teck, 2005. "Trade, capital accumulation and structural unemployment: an empirical study of the Singapore economy," Journal of Development Economics, Elsevier, vol. 77(1), pages 125-152, June.

    More about this item

    Keywords

    Phillips Curve; Wage Curve; Regions; Wage Inflation; Unemployment;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:boh:actaub:v:15:y:2012:i:1:p:91-101. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ivo Andrle (email available below). General contact details of provider: https://edirc.repec.org/data/efjcucz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.