Micro-components of aggregate wage dynamics
Abstract: We propose an approach for measuring and analyzing the dynamics of standard aggregate wage growth of macro statistics with micro-data. Our method decomposes aggregate wage growth to the wage growth of job stayers and to various terms related to job and worker restructuring. This method produces explicit expressions with clear interpretations for the various restructuring components and therefore opens new opportunities for a deeper analysis of various micro-level mechanisms and their cyclicality. The methodology also allows us to study many topics simultaneously that have previously been studied in isolation. Using comprehensive longitudinal employer-employee data over an extended period of time, we study how job and worker restructuring influences aggregate wage growth and its cyclicality. We show that wage formation is significantly more flexible than suggested by the aggregate numbers, and we identify the microlevel mechanisms that explain the greater flexibility. This version: December 7, 2012
|Date of creation:||07 Dec 2012|
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- Böckerman, Petri & Maliranta, Mika, 2003.
"The Micro-level Dynamics of Regional Productivity Growth: The Source of Divergence in Finland,"
854, The Research Institute of the Finnish Economy.
- Bockerman, Petri & Maliranta, Mika, 2007. "The micro-level dynamics of regional productivity growth: The source of divergence in Finland," Regional Science and Urban Economics, Elsevier, vol. 37(2), pages 165-182, March.
- Petri Böckerman & Mika Maliranta, 2003. "The micro-level dynamics of regional productivity growth: The source of divergence in Finland," ERSA conference papers ersa03p32, European Regional Science Association.
- Maliranta, Mika & Böckerman, Petri, 2009.
"Globalization, Creative Destruction, and Labor Share Change: Evidence on the Determinants and Mechanism from Longitudinal Plant-level Data,"
1178, The Research Institute of the Finnish Economy.
- Petri Böckerman & Mika Maliranta, 2012. "Globalization, creative destruction, and labour share change: evidence on the determinants and mechanisms from longitudinal plant-level data," Oxford Economic Papers, Oxford University Press, vol. 64(2), pages 259-280, April.
- Böckerman, Petri & Laaksonen, Seppo & Vainiomäki, Jari, 2006. "Micro-level evidence on wage rigidities in Finland," MPRA Paper 1811, University Library of Munich, Germany.
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