Skills, Wages, and Employment in East and West Germany

Michael Funke and Felix FitzRoy

No 1995/004, IMF Working Papers from International Monetary Fund

Abstract: Disaggregated data from 30 two-digit manufacturing industries in the east and west parts of unified Germany are used to estimate employment for three skill categories of blue collar workers. Employment elasticities are uniformly higher in the east, and for unskilled labor. The former result contradicts union claims that wages had little relevance for east German job losses, while the latter confirms the capital-skill complementarity hypothesis.

Keywords: WP; wage-employment elasticity; wage distribution; wage demand; wage push; long-run wage elasticity; wage rate; elasticities fall; egalitarian wage structure; wage elasticity; labor demand function; wage cost; wage development; Wages; Employment; Labor demand; Wage adjustments; Real wages; Eastern Europe (search for similar items in EconPapers)
Pages: 24
Date: 1995-01-01
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Related works:
Journal Article: Skills, Wages and Employment in East and West Germany (1998)
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