Inflation and labour markets

Bank for International Settlements
Authors registered in the RePEc Author Service: Emanuel Kohlscheen and Christian Upper

No 142 in BIS Papers from Bank for International Settlements

Abstract: Inflation shot up in both emerging market economies (EMEs) and advanced economies (AEs) in the wake of the Covid-19 pandemic. While labour market developments were not a key source of the surge, they could become important for the persistence of inflation and, thus, the path of disinflation. Despite this, there is comparatively little work on how labour market developments affect inflation in EMEs, quite in contrast to a substantial body of work in AEs. Instead, attention has mostly focused on other inflation drivers, for instance exchange rates. To fill this gap, the Bank for International Settlements dedicated its annual meeting of emerging market Deputy Governors to the topic of "Inflation and labour markets in the wake of the pandemic". The meeting was held in Basel 16-17 March 2023. The current volume contains a background paper by BIS staff as well as contributions by the participating central banks. Using the responses to a survey of EME central banks, the BIS background paper analyses the structure of labour markets in EMEs, wage formation and the relationship between wages and inflation. While there are important parallels, there are also notable differences across countries, both within and between regions. For example, a few countries feature strong unions and collective bargaining, while these are mostly absent from others. Such parallels and differences are also apparent in the central bank contributions, which dig deeper into individual country cases.

Date: 2023 Written 2023-11
ISBN: 978-92-9259-710-8
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Chapters in this book:

Inflation and labour markets , pp 1-19

Julián Caballero, Michael Chui, Emanuel Kohlscheen and Christian Upper

Inflation and labour markets: the view from Argentina , pp 21-34

Central Bank of Argentina

Inflation and labour markets in the wake of the pandemic: the case of Brazil , pp 35-66

Central Bank of Brazil

Inflation and labour markets in the wake of the pandemic: the case of Chile , pp 67-84

Central Bank of Chile

Labour market and inflation: the case of China , pp 85-101

People's Bank of China

The labour market in Colombia: trends, cyclical patterns and the role of wages in the recent inflationary surge , pp 103-134

Central Bank of Colombia

Inflation and labour markets in the wake of the pandemic: the case of Hong Kong SAR , pp 135-146

The Hong Kong Monetary Authority

Wage-price spiral in Hungary , pp 147-161

National Bank of Hungary

India's recent inflation experience: drivers and policy responses , pp 163-171

Reserve Bank of India

Bank Indonesia's short note for the BIS Annual Meeting of Emerging Market Deputy Governors , pp 173-177

Bank Indonesia

Labour market tightness and inflation in the aftermath of Covid-19: the case of Israel , pp 179-194

Bank of Israel

Labour markets and inflation , pp 195-202

Bank of Korea

Inflation and labour markets in the wake of the pandemic , pp 203-209

Central Bank of Malaysia

Overview of inflation and wage dynamics in Mexico in the aftermath of the pandemic , pp 211-220

Bank of Mexico

eru: labour market, wages and monetary policy in the aftermath of Covid-19 , pp 221-236

Central Reserve Bank of Peru

Labour market conditions and wage developments in the aftermath of the pandemic: implications for monetary policy in the Philippines , pp 237-250

Central Bank of the Philippines

The impact of monetary policy on employment in Poland through the lens of disaggregated data , pp 251-263

National Bank of Poland

Recent Inflation Dynamics in Singapore , pp 265-271

Monetary Authority of Singapore

A. Inflation and labour markets in the wake of the pandemic , pp 273-286

South African Reserve Bank

Labour market structure and wage dynamics in Thailand , pp 287-296

Bank of Thailand

Central Bank of the Republic of Türkiye note for the 2023 Emerging Markets Deputy Governors Meeting , pp 297-310

Central Bank of the Republic of Türkiye

Monetary policy and banking activities management measures to support labour market development , pp 311-314

The State Bank of Vietnam

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Chapter: Inflation and labour markets (2023)
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