Booming Sector and Wage Effects: An Empirical Analysis on Norwegian Data
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.
Volume (Year): 49 (1997)
Issue (Month): 1 (January)
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