IDEAS home Printed from https://ideas.repec.org/p/cwm/wpaper/36.html
   My bibliography  Save this paper

Controlling the Public Wage Bill in Portugal: The Case of University Professors

Author

Listed:
  • Alfredo M. Pereira

    () (Department of Economics, College of William and Mary)

  • Rui Manuel Pereira

    () (Faculdade de Ciencias e Tecnologia, Universidade Nova de Lisboa)

Abstract

Public wages are a large share of the public budget in Portugal and, therefore, hiring freezes are a central feature of the efforts to control the public deficit. The system of public career advancement, however, may lead to increases in the wage bill even in the presence of hiring freezes. We estimate this wage drift effect in the case of university professors. We use a logit analysis with 1999 census data to identify the determinants of career advancement, to estimate the employment distribution in previous years, and to obtain the corresponding wage bill. We estimate that the annual wage drift is 2.6%, a figure well above the GDP growth rate and, therefore, we conclude that hiring freezes may be far from enough to stop the expansion of the public wage bill.

Suggested Citation

  • Alfredo M. Pereira & Rui Manuel Pereira, 2006. "Controlling the Public Wage Bill in Portugal: The Case of University Professors," Working Papers 36, Department of Economics, College of William and Mary, revised 11 Aug 2006.
  • Handle: RePEc:cwm:wpaper:36
    as

    Download full text from publisher

    File URL: http://economics.wm.edu/wp/cwm_wp36rev.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Bas Klaauw & António Dias da Silva, 2011. "Wage dynamics and promotions inside and between firms," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(4), pages 1513-1548, October.
    2. Robert Gibbons & Michael Waldman, 1999. "A Theory of Wage and Promotion Dynamics Inside Firms," The Quarterly Journal of Economics, Oxford University Press, vol. 114(4), pages 1321-1358.
    3. George Baker & Michael Gibbs & Bengt Holmstrom, 1994. "The Internal Economics of the Firm: Evidence from Personnel Data," The Quarterly Journal of Economics, Oxford University Press, vol. 109(4), pages 881-919.
    4. McCue, Kristin, 1996. "Promotions and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 14(2), pages 175-209, April.
    5. Robert Gibbons, 1996. "Incentives and Careers in Organizations," NBER Working Papers 5705, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    public wages; budgetary restraint.;

    JEL classification:

    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:cwm:wpaper:36. 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: (Daifeng He) or (Alfredo Pereira). General contact details of provider: http://edirc.repec.org/data/decwmus.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.