Striking a Bargain: Narrative Identification of Wage Bargaining Shocks

Žymantas Budrys, Mario Porqueddu and Andrej Sokol
Additional contact information
Mario Porqueddu: European Central Bank

No 121, Bank of Lithuania Working Paper Series from Bank of Lithuania

Abstract: We quantify wage bargaining shocks’ effects on macroeconomic aggregates in Germany using a structural vector auto-regression model. We identify exogenous variation in bargaining power from episodes of minimum wage introduction and industrial disputes. This disciplines the impulse responses of unemployment and output, and sharpens inference on the behaviour of other variables, which is consistent with theoretical predictions from search and matching models. We find that wage bargaining shocks are an important contributor to agregate fluctuations in unemployment and inflation, exhibit close to full passthrough to consumer prices, and imply plausible dynamics for the vacancy rate, firms’ profits, and the labor share.

Keywords: Wage bargaining; minimum wage; industrial action; narrative restrictions; structural vector autoregression (search for similar items in EconPapers)
JEL-codes: C32 E32 J2 J3 (search for similar items in EconPapers)
Pages: 60 pages
Date: 2024-03-05
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.lb.lt/uploads/publications/docs/44309_ ... 07a29aab50bf5e24.pdf Full text (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden

Related works:
Journal Article: Striking a bargain: narrative identification of wage bargaining shocks (2022)
Working Paper: Striking a bargain: narrative identification of wage bargaining shocks (2021)
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:lie:wpaper:121

Access Statistics for this paper

More papers in Bank of Lithuania Working Paper Series from Bank of Lithuania Bank of Lithuania Gedimino pr. 6, LT-01103 Vilnius, Lithuania. Contact information at EDIRC.
Bibliographic data for series maintained by Aurelija Proskute ().