Real Wages and the Business Cycle: Accounting for Worker, Firm, and Job Title Heterogeneity

• Type: Article in International Scientific Journal
• Date: 2012

Authors

carneiro, a (Author) FEP; guimaraes, p (Author) FEP; portugal, p (Author) Other

Journal

Title: American Economic Journal: Macroeconomics

Vol. 4 No. 2

Pages: 133-152

ISSN: 1945-7707

Publisher: American Economic Association

Indexing

ISI Web of Knowledge - 81 Citations

ISI Web of Science

Scopus - 86 Citations

Scientific classification

FOS: Social sciences > Economics and Business

Other information

Authenticus ID: P-002-BGJ

DOI: 10.1257/mac.4.2.133

Abstract (EN): Using a longitudinal matched employer-employee dataset for Portugal over the 1986-2007 period, this study analyzes the wage responses to aggregate labor market conditions for newly hired workers and existing workers within the same firm. Accounting for worker, firm, and job title heterogeneity, the data support the hypothesis that entry wages are more procyclical than wages of stayers. A one point increase in the unemployment rate decreases wages of newly hired workers within a given firm-job title by around 2.7 percent and by 2.2 percent for stayers within the same firm-job title. Finally, the results reveal a one-for-one wage response to changes in labor productivity. (JEL: E24, E32, J64)

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 20