Fear, Unemployment and Pay Flexibility

David Blanchflower

Economic Journal, 1991, vol. 101, issue 406, 483-96

Abstract: The paper uses newly available cross-section data to study wage determination in the United Kingdom in the 1980s. The main results are as follows: (1) fear of unemployment substantially depresses pay; (2) there is some evidence of a wage ratchet whereby rates of pay are more flexible upwards than downwards; (3) the unemployment elasticity of pay averages -0.1; and (4) wages are much more flexible in nonunion workplaces than they are in union workplaces. Copyright 1991 by Royal Economic Society.

Date: 1991
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Related works:
Working Paper: Fear, Unemployment and Pay Flexibility (1990)
Working Paper: FEAR, UNEMPLOYMENT AND PAY FLEXIBILITY (1989)
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