Wage Dispersion and Country Price Levels

Robert Lipsey and Birgitta Swedenborg

No 6039, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The purpose of this paper was to investigate whether there is a relationship between the degree of wage dispersion in a country and its price level relative to other countries, compared in a common currency. It was found that once a country's real per capita income and deviations of its exchange rate from its trend value are allowed for, there is a pervasive relationship between wage dispersion and prices. Low wage dispersion, defined as a relatively small difference between the median wage and that of the lowest paid decile of workers, is associated with high price levels. The relationship applies more frequently to service prices than to goods prices, but where it does apply, the effects of wage dispersion are as large for goods as for services.

JEL-codes: E31 F3 (search for similar items in EconPapers)
Date: 1997-05
Note: IFM ITI
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published as Wage Dispersion and Country Price Levels , Robert E. Lipsey, Birgitta Swedenborg. in International and Interarea Comparisons of Income, Output, and Prices , Heston and Lipsey. 1999

Downloads: (external link)
http://www.nber.org/papers/w6039.pdf (application/pdf)

Related works:
Chapter: Wage Dispersion and Country Price Levels (1999)
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:nbr:nberwo:6039

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w6039

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().