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Wage Rigidities in Western Germany? Microeconometric Evidence from the 1990s

  • Puhani, Patrick A.

    (University of St. Gallen)

This paper investigates whether and in what sense the west German wage structure has been 'rigid' in the 1990s. To test the hypothesis that a rigid wage structure has been responsible for rising low-skilled unemployment, I propose a methodology which makes less restrictive identifying assumptions than some previous related work. I find that the relative stability of educational wage premia was justified by market forces. However, relative wages did not respond to negative net demand shocks for young workers, as well as white-collar workers.

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Paper provided by IRISS at CEPS/INSTEAD in its series IRISS Working Paper Series with number 2001-07.

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Date of creation: 2001
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Handle: RePEc:irs:iriswp:2001-07
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  31. Joachim Möller, 1999. "Changes of the Structure of Wages and Employment with Respect to Qualifications in Germany: An Empirical Analysis," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 219(1+2), pages 8-31, July.
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