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Booming Sector and Wage Effects: An Empirical Analysis on Norwegian Data


  • Brunstad, Rolf Jens
  • Dyrstad, Jan Morten


Within the framework of a segmented labor model and under the assumption of market clearing wages in all submarkets, this paper analyzes demand and cost-of-living effects which a booming sector may create. The tests are based on data before and after the most intensive building-up period of the Norwegian petroleum sector. The empirical results indicate significant demand effects for the most petroleum relevant occupations and also positive cost-of-living effects in areas which are regionally close to this sector. Overall there is evidence that the Norwegian petroleum sector has caused weak manufacturing performance. Copyright 1997 by Royal Economic Society.

Suggested Citation

  • Brunstad, Rolf Jens & Dyrstad, Jan Morten, 1997. "Booming Sector and Wage Effects: An Empirical Analysis on Norwegian Data," Oxford Economic Papers, Oxford University Press, vol. 49(1), pages 89-103, January.
  • Handle: RePEc:oup:oxecpp:v:49:y:1997:i:1:p:89-103

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    References listed on IDEAS

    1. Lars E O Svensson, 2005. "Monetary Policy with Judgment: Forecast Targeting," International Journal of Central Banking, International Journal of Central Banking, vol. 1(1), May.
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    4. Faust, Jon & Svensson, Lars E O, 2001. "Transparency and Credibility: Monetary Policy with Unobservable Goals," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(2), pages 369-397, May.
    5. Hans Gersbach, 2003. "On the negative social value of central banks' knowledge transparency," Economics of Governance, Springer, vol. 4(2), pages 91-102, August.
    6. Eijffinger, Sylvester C.W. & Geraats, Petra M., 2006. "How transparent are central banks?," European Journal of Political Economy, Elsevier, vol. 22(1), pages 1-21, March.
    7. George W. Evans & Seppo Honkapohja, 2003. "Adaptive learning and monetary policy design," Proceedings, Federal Reserve Bank of Cleveland, pages 1045-1084.
    8. Orphanides, Athanasios, 2003. "Monetary policy evaluation with noisy information," Journal of Monetary Economics, Elsevier, vol. 50(3), pages 605-631, April.
    9. Andrew Hallett & Jan Libich, 2012. "Explicit inflation targets and central bank independence: friends or foes?," Economic Change and Restructuring, Springer, vol. 45(4), pages 271-297, November.
    10. Eijffinger, Sylvester C W & Hoeberichts, Marco & Schaling, Eric, 2000. "Why Money Talks and Wealth Whispers: Monetary Uncertainty and Mystique," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 32(2), pages 218-235, May.
    11. Svensson, Lars E. O., 2005. "Monetary policy with judgment: forecast targeting," Working Paper Series 476, European Central Bank.
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    Cited by:

    1. Roberto Bande Ramudo & Melchor Fernández Fernández & Víctor Montuenga Gómez, 2011. "Wage flexibility and local labour markets: homogeneity of the wage curve in Spain," Documentos de trabajo - Analise Economica 0044, IDEGA - Instituto Universitario de Estudios e Desenvolvemento de Galicia.
    2. Mohammad R. Jahan-Parvar (bio) & Hassan Mohammadi (bio), 2011. "Oil Prices and Real Exchange Rates in Oil-Exporting Countries: A Bounds Testing Approach," Journal of Developing Areas, Tennessee State University, College of Business, vol. 45(1), pages 313-322, July-Dece.
    3. David G. Blanchflower & Andrew J. Oswald, 2005. "The Wage Curve Reloaded," NBER Working Papers 11338, National Bureau of Economic Research, Inc.
    4. Hassan Mohammadi & Mohammad Jahan-Parvar, 2012. "Oil prices and exchange rates in oil-exporting countries: evidence from TAR and M-TAR models," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 36(3), pages 766-779, July.
    5. van der Ploeg, Frederick, 2006. "Challenges and Opportunities for Resource Rich Economies," CEPR Discussion Papers 5688, C.E.P.R. Discussion Papers.
    6. International Monetary Fund, 2005. "Norway; Selected Issues," IMF Staff Country Reports 05/197, International Monetary Fund.
    7. Luis Felipe Céspedes C. & David Rappoport W, 2006. "El Fondo Gubernamental de Petróleo de Noruega," Notas de Investigación Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 9(1), pages 71-78, April.
    8. Erling Røed Larsen, 2003. "Are Rich Countries Immune to the Resource Curse? Evidence from Norway's Management of Its Oil Riches," Discussion Papers 362, Statistics Norway, Research Department.
    9. Jan Morten Dyrstad, 2015. "Resource curse avoidance: Governmental intervention and wage formation in the Norwegian petroleum sector," Working Paper Series 16715, Department of Economics, Norwegian University of Science and Technology.
    10. Erling Røed Larsen, 2004. "Escaping the Resource Curse and the Dutch Disease? When and Why Norway Caught up with and Forged ahead of Its Neighbors," Discussion Papers 377, Statistics Norway, Research Department.
    11. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
    12. Manfred Wiebelt & Rainer Schweickert & Clemens Breisinger & Marcus Böhme, 2011. "Oil revenues for public investment in Africa: targeting urban or rural areas?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(4), pages 745-770, November.
    13. Víctor M. Montuenga-Gómez & José M. Ramos-Parreño, 2005. "Reconciling the Wage Curve and the Phillips Curve," Journal of Economic Surveys, Wiley Blackwell, vol. 19(5), pages 735-765, December.

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