Are wages rigid in Colombia?: Empirical evidence based on a sample of wages at the firm level

Ana Iregui, Ligia Alba Melo B. () and María Teresa Ramírez G. ()
Authors registered in the RePEc Author Service: Ligia Melo () and Maria Teresa Ramirez-Giraldo

Borradores de Economia from Banco de la Republica de Colombia

Abstract: This paper uses Colombian data at the firm level for the period 1999 to 2006 to provide microeconomic evidence on the existence and extent of downward nominal wage rigidity. To conduct the analysis, we use a rich panel of firms for white and blue collar workers, consisting of 1517 firms for the former and 781 firms for the latter. The presence of wage rigidity is determined by means of three statistic techniques used in recent literature, such as the analysis of the histograms of the distribution of wage changes, the LSW statistic and the Kahn test. The results suggest the existence of downward nominal wage rigidities; it is worth mentioning that rigidity is higher for blue collar workers than white collar workers, since the increase in the wages of the blue workers is generally done by taking into account the change in the minimum wage, which is why a higher rigidity would be expected.

Keywords: Wage rigidity; Kahn test; LSW Statistic; Colombia. (search for similar items in EconPapers)
JEL-codes: C23 E24 J31 (search for similar items in EconPapers)
Date: 2009-08
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
https://doi.org/10.32468/be.571I (application/pdf)

Related works:
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:bdr:borrec:571i

Access Statistics for this paper

More papers in Borradores de Economia from Banco de la Republica de Colombia Cra 7 # 14-78. Contact information at EDIRC.
Bibliographic data for series maintained by Clorith Angélica Bahos Olivera ().