Real Wages over the Business Cycle: OECD Evidence from the Time and Frequency Domains

Julian Messina, Chiara Strozzi () and Jarkko Turunen

Center for Economic Research (RECent) from University of Modena and Reggio E., Dept. of Economics "Marco Biagi"

Abstract: We study differences in the adjustment of aggregate real wages in the manufacturing sector over the business cycle across OECD countries, combining results from different data and dynamic methods. Summary measures of cyclicality show genuine cross-country heterogeneity even after controlling for the impact of data and methods. We find that more open economies and countries with stronger unions tend to have less pro-cyclical (or more counter-cyclical) wages. We also find a positive correlation between the cyclicality of real wages and employment, suggesting that policy complementarities may influence the adjustment of both quantities and prices in the labour market.

Keywords: Real Wages; Business Cycle; Dynamic Correlation; Labour Market Institutions (search for similar items in EconPapers)
JEL-codes: C10 E32 J30 (search for similar items in EconPapers)
Pages: pages 43
Date: 2008-12
New Economics Papers: this item is included in nep-bec, nep-cba, nep-lab, nep-mac and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Real wages over the business cycle: OECD evidence from the time and frequency domains (2009)
Working Paper: Real wages over the business cycle: OECD evidence from the time and frequency domains (2009)
Working Paper: Real Wages over the Business Cycle: OECD Evidence from the Time and Frequency Domains (2009)
Working Paper: Real Wages over the Business Cycle: OECD Evidence from the Time and Frequency Domains (2008)
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