Downward Nominal Rigidity in West German Earnings, 1975-95

Thomas Beissinger () and Knoppik Christoph
Additional contact information
Knoppik Christoph: University of Regensburg,Regensburg, Bavaria, Germany

German Economic Review, 2001, vol. 2, issue 4, 385-417

Abstract: If downward nominal wage rigidity exists, it should affect the distribution of earnings changes. We present a common analytical framework for three distinct and previously unconnected approaches to the analysis of downward nominal rigidity, the skewness±location approach, the symmetry approach and the histogram±location approach. We modify them by dropping the assumption of time-invariant rigidity and apply them to earnings data from the IABB-escha Èftigtenstichprobe (IABS). We find that the distribution of West German log earnings changes is indeed affected by downward nominal rigidity. Our modification of the approaches also allows us to find that the degree of nominal rigidity depends on business cycle conditions, with weaker rigidity in times of rising unemployment. Our findings support the critics of very low inflation targets.

Date: 2001
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/1468-0475.00046 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

Related works:
Journal Article: Downward Nominal Rigidity in West German Earnings, 1975–95 (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:germec:v:2:y:2001:i:4:p:385-417

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/ger/html

DOI: 10.1111/1468-0475.00046

Access Statistics for this article

German Economic Review is currently edited by Peter Egger, Almut Balleer, Jesus Crespo-Cuaresma, Mario Larch, Aderonke Osikominu and Georg Wamser

More articles in German Economic Review from De Gruyter
Bibliographic data for series maintained by Peter Golla ().