Wage persistence and labour market institutions: an analysis of young European workers

A. G. Menezes, Dario Sciulli () and José Vieira

Applied Economics Letters, 2011, vol. 18, issue 9, 823-828

Abstract: This article investigates the effects of Labour Market Institutions (LMIs) on wage persistence among young European workers at the beginning of their careers. We use European Community Household Panel (ECHP) data from 1995 to 2001 for 13 EU countries and estimate a three-level random intercept probit model that allows for unobserved heterogeneity both at the individual and country level. Overall, we find that LMIs explain wage persistence. In particular, we find a high level of Employment Protection Legislation (EPL) and a high level of Bargaining Centralization (BC) increase wage persistence.

Date: 2011
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Working Paper: Wage Persistence and Labour Market Institutions: An Analysis of Young European Workers (2007)
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DOI: 10.1080/13504851.2010.505554

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