Are Real Wages and Unemployment Related?

Tor Jacobson (), Anders Vredin () and Anders Warne

No 8, SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: In this paper we propose an alternative method for investigating the sources behind the behavior of real wages and unemployment. The statistical model we study is a certain structural error correction model, a so called common trends model, which has become popular in the empirical growth/business cycle literature. The system consists of real output, employment, unemployment and the product real wage and two exogenous stochastic variables, a tax wedge and a currency basket index. Based on quarterly Swedish data (1965-90) we find evidence supporting a short run but not a medium or long run relation.

Keywords: Common trends; error correction; supply and demand shocks (search for similar items in EconPapers)
JEL-codes: C15 C32 C52 E24 (search for similar items in EconPapers)
Pages: 48 pages
Date: 1994-01
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Published in Economica, 1998, pages 69-96.

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Working Paper: Are Real Wages and Unemployment Related? (1993)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:hastef:0008

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