Fear, Unemployment and Pay Flexibility

David Blanchflower

No 3365, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The paper uses newly available cross-section data to study wage determination in the United Kingdom in the 1980s. The results are contrasted with those from a comparable sample from the US from 1977-1988. 1) Fear of unemployment substantially depresses pay in both countries. 2) There is some evidence of a wage ratchet in the UK whereby rates of pay are more flexible upwards than downwards. 3) The unemployment elasticity of pay averages -0.1 in the UK and apparently zero in the US. 4) Wages are almost twice as flexible in non-union and small workplaces in the UK.

Date: 1990-05
Note: LS
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Citations: View citations in EconPapers (41)

Published as The Economic Journal, Vol. 101, No. 406, pp.483-496, (May 1991).

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Related works:
Journal Article: Fear, Unemployment and Pay Flexibility (1991)
Working Paper: FEAR, UNEMPLOYMENT AND PAY FLEXIBILITY (1989)
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