Regional wages and state training measures : an extended wage curve for eastern Germany

Abstract

"One common feature of all empirical wage curve studies is the underlying assumption that the unemployment rate is the natural indicator of labour market tightness. However, we observe that in many European countries governments spend remarkable amounts on active labour market policies, such as labour market training programs. As training programs maintain the search effectiveness of the unemployed and enhance their skills, we incorporate these measures into the standard wage curve approach. Our empirical work reveals an extended wage curve in east Germany. If the influence of training is neglected, the estimates display no significant relationship between regional wages and labour market tightness." (Author's abstract, IAB-Doku) ((en))

Cite article

Pannenberg, M. & Schwarze, J. (1996): Regionale Löhne und staatliche Qualifizierungsmaßnahmen. Eine erweiterte Lohnkurve für Ostdeutschland. In: Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Vol. 29, No. 3, p. 494-497.