The wage curve in the 1990s : the relationship between average regional wages and regional unemployment in a multilevel analysis using the IAB establishment panel.

Abstract

"The flexibility of European labour markets is widely discussed by researchers and politicians. To explore the reactions of wages to regional unemployment for the first time data from a national representative survey of establishments (the IAB Establishment Panel) has been used. The results obtained are in accordance with the wage curve hypothesis: Regional wages react to regional unemployment. The estimates for the elasticity of wage with respect to unemployment are similar to those Blanchflower/Oswald obtained for the USAand Great Britain, although Germany is an example of a country where wages are negotiated in centralised bargaining. For the econometric analyses an adaption of multilevel models to longitudinal data is used, which controls for the dependency of observations within regions and between points in time. The danger of spurious regression estimates is therefore avoided." (Author's abstract, IAB-Doku) ((en))

Cite article

Bellmann, L. & Blien, U. (1996): Die Lohnkurve in den neunziger Jahren. Der Zusammenhang zwischen regionalen Durchschnittslöhnen und regionaler Arbeitslosigkeit in einer Mehrebenenanalyse mit dem IAB-Betriebspanel. In: Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Vol. 29, No. 3, p. 467-470.