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Sectoral differences in downward real wage rigidity: workforce composition, institutions, technology and competition

Sectoral differences in downward real wage rigidity: workforce composition, institutions,... This paper examines whether differences in wage rigidity across sectors can be explained by differences in workforce composition, wage-bargaining institutions, technology and competition. We rely on a large administrative matched employer-employee dataset for Belgium over the period 1990–2002. Our results indicate that downward real wage rigidity is significantly higher for white-collar workers, lower for older workers and decreases with the level of earnings and bonuses. Beyond labour force composition effects, we find that wages are more rigid in sectors with predominant centralised wage-setting at the sector level as opposed to firm-level agreements. Also, more labour-intensive sectors and competitive sectors have more rigid wages. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal for Labour Market Research Springer Journals

Sectoral differences in downward real wage rigidity: workforce composition, institutions, technology and competition

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Publisher
Springer Journals
Copyright
Copyright © 2012 by Institut für Arbeitsmarkt- und Berufsforschung
Subject
Economics; Labor Economics; Sociology, general; Human Resource Management; Economic Policy; Regional/Spatial Science; Population Economics
ISSN
1614-3485
eISSN
1867-8343
DOI
10.1007/s12651-012-0100-3
Publisher site
See Article on Publisher Site

Abstract

This paper examines whether differences in wage rigidity across sectors can be explained by differences in workforce composition, wage-bargaining institutions, technology and competition. We rely on a large administrative matched employer-employee dataset for Belgium over the period 1990–2002. Our results indicate that downward real wage rigidity is significantly higher for white-collar workers, lower for older workers and decreases with the level of earnings and bonuses. Beyond labour force composition effects, we find that wages are more rigid in sectors with predominant centralised wage-setting at the sector level as opposed to firm-level agreements. Also, more labour-intensive sectors and competitive sectors have more rigid wages.

Journal

Journal for Labour Market Research – Springer Journals

Published: Jan 18, 2012

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