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Wage Cyclicality Revisited: The Role of Hiring Standards

Author

Listed:
  • Choi, Sekyu
  • Figueroa, Nincen
  • Villena-Roldán, Benjamin

Abstract

In this paper we analyze cyclicality of wages at the job level, using posted wage data from an online job board in an emerging economy. Our data contains a significant fraction of online job advertisements in the Chilean economy for the period 2009 to 2018 and is representative of the overall wage distribution of newly hired workers. One major advantage of our dataset is the availability of wage information along information on requirements for each job. We find significant levels of posted wage procyclicality, safely ignoring any cyclical mismatch. We show how omitted variable bias, by ignoring countercyclical changes in hiring standards, reduces the amount of cyclicality found in previous studies.

Suggested Citation

  • Choi, Sekyu & Figueroa, Nincen & Villena-Roldán, Benjamin, 2020. "Wage Cyclicality Revisited: The Role of Hiring Standards," MPRA Paper 98240, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:98240
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    File URL: https://mpra.ub.uni-muenchen.de/98528/1/MPRA_paper_98528.pdf
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    More about this item

    Keywords

    Wage cyclicality; online job boards; composition bias; hiring standards;

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J4 - Labor and Demographic Economics - - Particular Labor Markets
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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