Employment Fluctuations and Dynamics of the Aggregate Average Wage in Poland 1996-2003
The aggregate average wage is often used as an indicator of economic performance and welfare, and as such often serves as a benchmark for changes in the generosity of public transfers and for wage negotiations. Yet if economies experience a high degree of (nonrandom) fluctuation in employment the composition of the employed population will have a considerable effect on the computed average. In this paper we demonstrate the extent of this problem using data for Poland for the period 1996-2003. During these years employment in Poland fell from 51.2% to 44.2% and most of it occurred between the end of 1998 and the end of 2002. We show that about a quarter of the growth in the average wage during this period could be attributed purely to changes in employment.
|Date of creation:||Nov 2006|
|Date of revision:|
|Publication status:||published in: Economics of Transition, 2007, 15(4), 759-799|
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