Till labor cost do us part. On the long run convergence of EMU countries
A sustainable long-run pattern in the relative competitiveness of euro area countries is a key factor for the survivorship of the monetary union. We analyze the issue focussing on unit labor cost dynamics using cointegration analysis for the whole economy and for the manufacturing sector separately. Our findings show that the introduction of the euro has increased, rather than decreased, the distance among member countries, as measured in the metric of unit labor costs. Dispersion of productivity rather than wage compensation suggests that persisting idiosyncratic dynamics are driven by real factors, i.e. diverging technological patterns rather than by monetary factors, expressed by wage compensation.
|Date of creation:||Jun 2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +39 051 209 8019 and 2600
Fax: +39 051 209 8040 and 2664
Web page: http://www.dse.unibo.it
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:bol:bodewp:wp759. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Luca Miselli)The email address of this maintainer does not seem to be valid anymore. Please ask Luca Miselli to update the entry or send us the correct address
If references are entirely missing, you can add them using this form.