Economics at your fingertips  

Wage Dispersion and Productive Efficiency: Evidence For Sweden

Douglas Hibbs () and Håkan Locking ()

No 21, Working Papers in Economics from University of Gothenburg, Department of Economics

Abstract: The effects of wage dispersion on productive efficiency is a topic rich in theoretical conjecture, a common object of Scandinavian polemical debate and at the same time an issue almost barren of systematic econometric evidence. The Swedish record of enormous compression of relative wages under the institutional regime of centralized solidarity bargaining, followed by substantial de-compression of wages after central bargaining broke down, supplies observations well suited for empirical testing of theories and assertions about the response of productive efficiency to shifts in wage distribution. Results presented in this paper obtained from regression experiments based on distribution-augmented production and labor productivity functions yield no support of 'fairness, morale and cohesiveness' theories implying that wage leveling within workplaces and industries may enhance productivity. We do find substantial evidence, however, that reduction of inter-industry wage differentials contributed positively to aggregate output and productivity growth, most likely for the structural reasons first emphasized by leading Swedish trade union economists almost a half century ago.

Keywords: productivity; wages; distribution (search for similar items in EconPapers)
JEL-codes: J23 J31 J51 L16 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2000-01-24
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 (77) Track citations by RSS feed

Published in Journal of Labor Economics, 2000, pages 755-783.

Downloads: (external link) (application/pdf) (application/pdf) (application/postscript) (application/postscript)

Related works:
Journal Article: Wage Dispersion and Productive Efficiency: Evidence for Sweden (2000) Downloads
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:

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Working Papers in Economics from University of Gothenburg, Department of Economics Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Ann-Christin Räätäri Nyström ().

Page updated 2021-04-12
Handle: RePEc:hhs:gunwpe:0021