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The Wage Curve: A Review


  • David Card

    (Princeton University)


In The Wage Qurve, David G. Blancflower and Andrew J. Oswald argue that there is a fundamental negative relation between wages and the unemployment rate in a worker's local labor market. Blancflower and Oswald use large-scale micro data sets to estimate this relation for the United States, Britain, and 10 other countries. I review their empirical methods and findings, and provide some further evidence on the nature of the wage curve relationship in the United States. I conclude that there is a strong statistical correlation between rates of pay and local unemployment, although the interpretation of this correlation remains unresolved.

Suggested Citation

  • David Card, 1995. "The Wage Curve: A Review," Working Papers 722, Princeton University, Department of Economics, Industrial Relations Section..
  • Handle: RePEc:pri:indrel:343

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    wage curve; local labor markets; wage determination;
    All these keywords.

    JEL classification:

    • B16 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Quantitative and Mathematical
    • B19 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Other


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