The Role of Unemployment in Wage Determination: Further Evidence on the Wage Curve from Turkey

Ipek Ilkaracan and Raziye Selim
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Ipek Ilkaracan: New School University, https://www.economicpolicyresearch.org
Raziye Selim: Istanbul Technical University, https://www.itu.edu.tr

No 2002-11, SCEPA working paper series. from Schwartz Center for Economic Policy Analysis (SCEPA), The New School

Abstract: This paper presents an empirical estimation of the correlation between wages and regional unemployment rates in Turkey, more specifically it explores the role of regional unemployment rates in wage determination. The analysis builds upon a series of recent empirical studies on the wage-unemployment relationship, now commonly known as “the wage curve,†a downward sloping curve in wage-unemployment space. The existing studies are for most part in advanced market economies, while this paper presents one of the few attempts at a wage curve analysis within the context of a developing market economy. A cross-sectional estimation of micro level individual wage data for the Turkish labor market in 1994, suggest a statistically significant negative correlation between wages and regional unemployment rates. Separate regressions for men and women, however, show a wage curve to exist only in the male labor market. The study also presents the results on other variables of wage determination such as returns to schooling, returns to age, job tenure, gender, industrial and occupational affiliation of the worker, economic sector and union status.

Keywords: wage curve; unemployment; Turkey (search for similar items in EconPapers)
JEL-codes: J31 J64 O15 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2002-08
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (4)

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